Nathan Coates, 02 February 2016

Analysts are tipping diesel prices will remain low, having fallen 15 cents in the last three months.

Commsec economist Savanth Sebastian said a global oil glut was behind the current cost of diesel fuel.

“The flow through effect for diesel certainly hasn’t take place to the same extent it has for unleaded petrol and I think that’s an issue around refining costs of fuel,” he said.

“If you look at the national average diesel price at the moment, it’s down just shy of 1 cent per litre in the last week.

“It’s holding around 1.12 per litre. I think this is where it will stay over the near term.”

Townsville motorists are paying 10 cents above what we believe is a fair price

Renee Smith, Queensland motor lobby group RACQ

Mr Sebastian said the average national price for unleaded petrol was $1.06 per litre

He said the petrol price might be more volatile than diesel but expected prices would likely hover around the current average for the foreseeable future.

“You have discounting cycles in most states and territories and you can save yourself up to 30 cents per litre between the peak and the trough,” Mr Sebastian said.

Prices varying throughout regional Australia

Regional and rural motorists have reported fuel prices of between 10 and 20 cents higher than the national average.

Drivers from Burnie, in north west Tasmania, reported an unleaded price of $1.19 a litre with diesel at $1.13.

The ACCC is monitoring petrol prices in northern Tasmania because of reports of prices being slow to adjust.

Residents of Broken Hill, in far west in NSW, are paying $.124 per litre for unleaded and $1.17 per litre for diesel.

Ayr, 90 kilometres south of Townsville, is offering the cheapest fuel in regional Queensland, something Renee Smith from motor lobby RACQ says is tough to explain.

“We don’t know exactly what is happening in Ayr,” she said.

“The average fuel price in Townsville is $1.18 whereas in Ayr it’s down at $1.01.

“Townsville motorists are paying 10 cents above what we believe is a fair price. That takes into account the price of oil, the terminal gate price and any other costs and margins.”

Greater competition keeping prices down in the Red Centre

In the centre of Australia in Alice Springs, low sale volumes and transport have long been cited by fuel companies when explaining high fuel prices.

But an additional competitor has entered the market outside Alice Spring, with the national fuel retailer offering diesel at $1.15 per litre and unleaded at $1.19 per litre.

The prices are approximately 10 cents cheaper than in the town.

“I think it’s great because normally I’ve got to go into town to get fuel,” Alice Springs motorist Robbie said.

“I normally take about 140 litres each time I fill up. Instead of paying about $250, I’ll fill my car up for $170. It’s a big difference.”

On transport costs being the major explanation for higher fuel prices in the Red Centre, Robbie said “it’s a bit of hogwash as far as I’m concerned”.

“If one person can do it, they should all be able to do it,” he said.

Extracted in full from ABC News.