This is an archived release.
Higher prices of energy
The Producer price index (PPI) increased by 2.2 per cent from December 2011 to January 2012. Price rises in oil, natural gas, refined petroleum products and electricity have contributed the most to the increase in the PPI.
The PPI went up 2.2 per cent from December 2011 to January 2012. In January, producer prices were affected by price adjustments and reassessments of contracts. This resulted in greater price variation for most PPI industries. The industries that contributed the most to the month’s change were extraction of oil and natural gas, refined petroleum products and electricity, which increased by 3.6, 5.4 and 4.6 per cent respectively.
Oil and petroleum products up
Price development in extraction of oil and natural gas was affected by higher prices of both oil and gas. Oil price (Brent Blend, in NOK) increased by 4.3 per cent from December to January. Iran’s warnings of cutting their oil supplies to Europe together with expectations of improvements in the US and Chinese economies helped to explain the price rise of crude oil.
Prices in refined petroleum products increased as a result of a sharp price rise in petrol, diesel, fuel oil and marine gas oil. Development in prices in refined petroleum products was due to high prices of crude oil. In the case of fuel oil and marine gas oil, other factors also influenced the price development. Acute shortage of fuel oil and marine gas oil, caused by lower production, was one of the reasons. In addition, higher demand from Japan, which currently uses fuel oil for its power production, was also a significant contributor to the rise in the international prices for the commodities.
Price increases in electricity and metals
Electricity prices increased by 4.6 per cent from December to January. The price rise in electricity in January was particularly noticeable in the second half of the month, when colder weather in most of Norway caused higher power consumption and contributed to higher electricity prices.
Prices of basic metals also increased from December to January, after falling for much of 2011. The price rise of 1.3 per cent was caused by higher prices of non-ferrous metals. Most of the metals traded on the London Metal Exchange, including aluminium and nickel, experienced price increases as a result of the positive figures on the growth of the Chinese economy published in mid-January.
Twelve-month growth: prices up 7.9 per cent
From January 2011 to January 2012, the PPI increased by 7.9 per cent. The largest contributors were extraction of oil and natural gas, refined petroleum products and food products, where prices rose by 18.9, 16.8 and 3.5 per cent respectively. Despite the price rise from December to January, prices in electricity and basic metals fell in the last twelve months. Price declines in these groups were 37.6 and 11.3 per cent respectively.
|January 2012||Changes, per cent|
|December 2011-January 2012||January 2011-January 2012|
|Extraction and related services||392.9||2.9||18.1|
|Manufacturing, mining and quarrying||157.0||1.3||3.2|
|Electricity, gas and steam supply||257.2||4.6||-37.6|
|Main industrial groupings|
New industry in PPI
From January 2012, a new industry is included in the PPI. Price changes within the industry mining support service activities is now included in the calculation of the index. The industry is largely dominated by services supplied to oil and gas extraction on the Norwegian continental shelf. The results are published as a separate index for the industry, which can be found in StatBank and in attached tables (see links in left margin). Since price changes are included in the PPI for the first time in January 2012, the index series starts in December 2011. Otherwise, the industry is included in calculations of the total index, the index of extraction and related services as well as the index for intermediate goods. In 2012, the industry represents about seven per cent of the weights used in the PPI calculations.
Updated weights in the index
With the new year, the weights used to compute the price indices were updated. The weights indicate the relative influence of different industries on the overall index, and are based on the industries' share of Norwegian output value in the previous year. Compared with 2011, the weights of most industries fell, due to the inclusion of the new industry mining support service activities. The domestic market became more important compared with the export market. A possible explanation for this is that Norwegian exporters experienced greater difficulties in their markets in 2011 than producers who sold their products to the Norwegian market.
All changes in the weights are due to a combination of changes in production volumes and prices. In addition, there is a certain effect caused by a slight change in data used in the weight calculation in 2012. The input material for the PPI’s weights is made up of output values from the national accounts. For the first time, this data is now available grouped according to a new industry standard. This may have contributed to some degree of weight shift between the industries in the PPI, as products may have been classified differently in the old and the new standard.
Use the links "Weights" or "More tables in StatBank" in the left hand window for more details about the weights.
For information on the commodity price index for the industrial sectors, see commodity price index for the industrial sector
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