ACCC report shows fuel prices have gone up
The regulator's report details rising petrol prices, profits and costs.
The Australian Competition and Consumer Commission (ACCC) has released a detailed report revealing petrol, diesel and LPG fuel prices have risen, in some cases quite dramatically. Here’s what you need to know.
Petrol prices at two and a half year high
The ACCC found that average petrol prices at the pump were 135.1 cents per litre (cpl), an increase of 12.6 cpl from the previous quarter. The last time prices were this high was two and a half years ago in the June quarter of 2015. In the last half of 2017 alone, the prices motorists were paying rose 20.3 cpl.
Diesel and LPG prices increased
Diesel and LPG prices also increased, though not as much as petrol. Average diesel prices were 133.8 cpl as opposed to 126.3 cpl from the last reporting period. LPG is now priced at 82.2 cpl on average, a difference of 10.0 cpl from the previous report.
Why are fuel prices up?
The combination of four factors is to blame for the price hike:
- International crude oil and refined petrol prices have ballooned. Worldwide demand increased and oil-producing cartels restricted production. A barrel of crude oil went from US$9 to US$61. Refined petrol rose from just US$7 per barrel to US$74.
- A less favourable AUD-USD exchange rate. Because global markets use United States dollars, currency conversion rates impact the retailers, who pass the expense onto motorists.
- Gross retail margins increased to a record-high 14.2 cpl, rising by 3.9 cpl during the quarter. It should be noted that the gross retail margins do not include transportation, labour and marketing, merely the wholesale price of petrol.
- Fuel retailers stated that in order to recoup past one-off compliance and regulatory costs they are spreading the amounts out over a number of years.
Brisbane has the most expensive fuel
In the December 2017 quarter, average Brisbane fuel prices sat at 138.5 cpl, 4.3 cpl higher than Sydney, Melbourne, Adelaide and Perth. Brisbane drivers have been paying more than the other four largest cities for the last eight years.
What reason did the ACCC report find for this pricing difference? Less competition in Brisbane with fewer big retail chains. The resulting cost to Brisbane motorists is a whopping $50 million per annum!
ACCC: Motorists, fight back!
The ACCC said motorists are not powerless and shouldn’t just accept the situation.
“Motorists can fight back against these high prices by using fuel price websites and apps to shop around. Consumers can save significantly by timing their purchases during the price cycle, which encourages retailers to be more competitive,” ACCC Chairman Rod Sims said.
“Retail prices in the larger capital cities can vary by around 25 cents per litre to 30 cents per litre near the time that price cycles are increasing. The ACCC website has information on price cycles in the five largest cities and provides tips on when to buy petrol.”
You can also save by driving more efficiently, ditching unnecessary accessories and carrying out some basic checks on your vehicle. Check out our 10 ways to get better fuel economy guide. You might also investigate getting a fuel card with our fuel card comparison.