04 January 2016

Scrutiny over petrol pricing in the last quarter of 2015 is continuing as both the ACCC and research by the parliamentary library suggest it was unfairly high.

But on Monday bowser prices dropped below cost as wholesale petrol fell to its lowest since February, with Australian Institute of Petroleum spokesman Paul Barrett telling AAP the industry was transparent with its pricing.

However, research from the parliamentary library shows that Sydney’s petrol prices were around eight cents higher than usual retail margins, even as wholesale prices dropped by nearly 25 per cent.

“The ACCC is very concerned that recently Sydney consumers have been paying much more for petrol than it appears they should have been,” ACCC chairman Rod Sims said in a statement on Monday.

NRMA spokesman Peter Khoury said that recent scrutiny had caused retailers to drop their prices.

“Oil companies crying wolf is nothing new and I think it is a bit rich for these organisations to be saying that the regulatory costs are what is causing them to make sometimes 30-40 cents of profit,” Mr Khoury said.

The figures show that as wholesale price rose in the past the cost at the bowser followed closely but as it fell petrol companies reduced prices at a much slower rate.

“At the heart of this transaction is gouging by the fuel companies and it’s a simple jedi mind trick to lower prices so consumers feel like they’re getting a better deal but not enough to demonstrate the savings,” Labor Senator Sam Dastyari told AAP.

Senator Dastyari said a recent lawsuit around publishing petrol pricing information and industry scrutiny in Melbourne had helped reduce prices.

“Make sure the regulator has the teeth and power it requires, when the regulator takes tough action like we’ve seen in Melbourne prices will decline,” he said.

But Australian Convenience and Petroleum Marketers Association spokesman Mark McKenzie told AAP that it was unfair to judge petrol prices over a single quarter.

“People are drawing conclusions based on a very small dataset,” Mr McKenzie said.

He said the industry had been investigated for eight years and had so far found no case to answer because petrol pricing fairly followed the changes in wholesale trends.

Mr McKenzie also rejected claims that Melbourne’s prices were cheaper than Sydney, citing the opposite for Monday at $1.25 per litre in Melbourne and $1.07 in Sydney.

Extracted in full from 7 News.