PETROL prices may have sunk to their lowest level in 15 years, but according to Australia’s consumer watchdog, it wasn’t us reaping the benefit.
The Australian Consumer and Competition Commission’s quarterly report into petrol pricing – this time covering the second quarter of this year – showed the money fuel retailers made from each litre of petrol they sold remained high despite the average price of fuel falling to 122.6 cents a litre last financial year.
“While motorists are enjoying the cheapest petrol since 2002, we believe prices should have been even lower given the continuing high gross retail margins,” ACCC chairman Rod Sims said in a statement.
The ACCC study showed that while the retail margins across Australia’s five largest cities fell 0.6 cents a litre in the second quarter of this year, the retail margins in Melbourne (12.3 cents a litre) and Perth (12.0 cents a litre) were also the highest in real terms since 2002.
The ACCC noted the increase in gross margins since 2014-15 “may partly reflect regulatory and compliance costs, especially in NSW”.
“However, the ACCC believes that these increasing costs do not fully explain the sharp increase in margins,” it said.
Australia has benefitted from OPEC’s failed attempt to restrict the supply of oil globally, causing prices at the pump to fall.
However, like their city cousins, regional motorists were also hit with higher-than-expected margins.
“In three of the four regional petrol markets that the ACCC has studied in depth in recent years (Darwin, Launceston, Armidale, and Cairns), retail prices in Launceston, Armidale, and Cairns remained above a long-term competitive cost-based price in the June quarter 2017,” the ACCC said.
A recent separate inquiry into fuel pricing in Cairns noted the city’s fuel retailers were making an average of 38 cents a litre profit, much higher than other regional sites throughout Australia.
Looking at quarterly data for the three months from April to June, the ACCC found Brisbane had the highest fuel cost of the five largest cities, with the average retail petrol price 3.3 cents a litre higher than the average across the other four largest cities.
The ACCC said of prices paid at the bowser, only 42.2 percent reflected the international oil price, with another 42 percent attributed to government levies such as the GST and fuel excise.