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More than half the petrol stations in Sydney and Melbourne have already hiked their prices for regular unleaded by 5¢ to 10¢ per litre, new analysis shows, even as the Albanese government warns the industry that price gouging will not be tolerated.
Although the conflict in Iran has pushed up the cost of crude oil and will affect retail fuel prices, experts and officials say it takes at least seven days for any price hikes to flow through to Australian bowsers.
But 50.3 per cent of Melbourne’s service stations have already increased regular unleaded prices to at least $2.19 a litre, and 50 per cent of Sydney’s service stations are selling above $2.17 a litre, new data compiled by the National Roads and Motorists Association (NRMA) reveals.
Selling regular unleaded at those prices was unjustified, the motoring group said, and amounted to “price gouging” because they were an average of more than 5¢ higher than what they should ordinarily be, even at the top of end of Melbourne and Sydney’s price cycles.
“What is clear is that a whole bunch of service stations in our biggest cities have manipulated the price cycle and are using Iran as an excuse to push up their profit margins,” NRMA spokesman Peter Khoury said.
“Most of the petrol that the service stations are selling at exorbitant prices was not bought in the last 24 hours to justify passing on that increase in wholesale prices.”
Treasurer Jim Chalmers said on Wednesday that service stations “cannot be taking people for mugs”, adding that the government had instructed the national consumer watchdog to crack down on any price gouging.
“We take the views of the NRMA and other motorist groups very seriously, as does the [Australian Competition and Consumer Commission],” Chalmers said. “It has got an important role to play here, and we’re making sure that they are as empowered as they can be to do that work.”
Energy Minister Chris Bowen called a snap press conference to urge motorists not to panic-buy petrol and said there was no risk of supply running short. Motorists are queuing up at petrol stations across the country amid fears of price hikes and short supplies.
“There’s no, no case for panic buying. I urge people only to buy petrol when they need it… There is no need to rush to the service station and fill up,” Bowen said.
Australian fuel prices go through cycles of varying durations, during which retailers progressively discount their fuel by a few cents each day to compete for market share until prices bottom out, then spike again by as much as 25¢ to 40¢ a litre in one day.
However, Khoury said average fuel prices across more than half of the service stations in Australia’s two biggest cities were “way over where they should be” at this stage, given it was too early for so many retailers to have felt the impact of a 5.5¢ rise in terminal-gate prices since the conflict in Iran over the weekend.
With at least 12 per cent of Sydney’s service stations selling regular unleaded below $1.89 a litre, Khoury said not all service stations were doing the wrong thing , but “sadly, too many are.
“There are still service stations in your cities that are not ripping you off – go to those service stations,” he said.
Representatives for Australian fuel retailers on Wednesday said price cycles in Sydney and Melbourne had been trending up since February, and the cost of refined fuels on global markets had risen sharply this week.
“Some retailers see international price changes immediately, while others experience them with a delay,” said Rowan Lee, chief executive of the Australasian Convenience and Petroleum Marketers Association.
Lee rejected the NRMA’s analysis, and called it “extremely unhelpful” at a time when fuel retailers were trying to keep up supply to meet heightened demand from motorists.
The ACCC said it would be watching fuel retailers’ price movements closely.
“Changes in international and wholesale petrol prices influence retail petrol prices, but the changes can take time to flow through,” an ACCC spokesman said. “Generally, [it is] only when fuel is replenished at a retail site that wholesale price changes are reflected in retail prices.”
The widening war in Iran has intensified concerns over global supplies of crude oil – the natural resource refined into petrol, diesel and jet fuel – and is expected to ultimately push up transport costs for consumers worldwide, even if the conflict is short-lived. The cost of a barrel of oil has so far climbed 10 per cent to around $US80.
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Nick Toscano is a business reporter for The Age and Sydney Morning Herald.Connect via X or email.
Mike Foley is the climate and energy correspondent for The Age and The Sydney Morning Herald.Connect via email.From our partners
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