Aussie petrol prices reach 18-month low

Petrol prices in Sydney, Melbourne, Brisbane, Adelaide and Perth dipped to an 18-month low in December, new research from the consumer watchdog reveals.

However, the news wasn’t so good for diesel and LPG customers.

The ACCC’s latest quarterly report, released today, shows that petrol prices fell by 25 per cent between October and December last year, after reaching a four-year high in August.

Average prices reached a 10-year high of 159.9 cents per litre (cpl) before falling dramatically to 119.2 cpl at the end of the year – figures not seen since August, 2017.

The fluctuation reflects a sharp decline in crude oil prices through November and December, amid concerns of a global trade war that threatened to reduce economic activity and subsequently demand for crude oil. Compounding this was increased US shale oil production, which boosted global oil supplies

“Petrol prices dropping so dramatically in time for the end of year holidays was great news for motorists. It’s good to see that retail prices followed the fall in international prices in many locations,” ACCC chair Rod Sims said.

While prices did not fall as sharply in regional locations in the December report, preliminary ACCC figures from January this year suggest they have since followed suit.

“We will monitor prices closely in our smaller cities and regional areas and highlight where prices do not reflect the large fall in crude oil prices,” Sims said.

Perth was the most expensive of Australia’s five largest cities in the December quarter 2018 at 144.4 cpl, while Sydney had the cheapest prices at 137.9 cpl average.

The news wasn’t so bright for diesel and LPG customers, either, following an increase on both fronts. Average retail diesel prices were 158.1 cpl, and automotive LPG prices were 88.4 cpl in the quarter.

The fall in petrol prices comes as gross retail margins (gross indicative retail differences, or GIRDs) across the five largest capitals increased 13.9 cpl in the quarter, suggesting retail margins have improved despite a fall in prices.

GIRDs are the difference between average retail prices and average wholesale prices, and are a broad indicator of gross retail margins.

Taking advantage of routine price cycles is considered the most effective way to save money on fuel, Sims said. In a recent report, the ACCC said motorists who timed their refuels at the “trough” of the cycle could save up to $520 annually.

“There are big savings to be had by motorists who use apps to shop around for cheap fuel and who also use price cycle information on the ACCC website to time their purchases.

“Price transparency through fuel price websites and apps, and price cycle buying tips is important for consumers and has a flow-on effect. As more motorists start using information to their advantage, petrol stations become aware they need to be competitive on price to get business.”