Fuel prices hit 17-year low, says watchdog

OWN a brawling, fuel hungry V8, and noticed a thick wad of cash lining your wallet lately?

The reason you’re so lush is because to find a time when fuel was as cheap as it has been for the previous three months, you have to go back to the last millennium.

The Australian Competition and Consumer Commission’s latest report on fuel pricing across Australia, released this week, shows the last time the cost per litre of petrol from the pump was this cheap, John Howard was Prime Minister.

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The consumer watchdog’s report says the average petrol price in the five largest cities in the March quarter was 111.0 cents per litre, which was 13.4cpl lower than in the previous quarter and 22.2cpl lower than the last three months of 2015.

“Motorists benefited from the lowest quarterly petrol prices in inflation-adjusted terms since 1999,” ACCC chairman Rod Sims said in a statement.

“The low petrol prices were due to two main influences: firstly, crude oil prices and international refined petrol prices in inflation adjusted terms fell to lows not seen since 2002 and 2008, respectively,” Mr Sims said.

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“Secondly, gross retail margins decreased in the quarter. The ACCC believed that retail margins were unreasonably high in the second half of 2015 and wrote to the major petrol retailers in early February 2016 seeking an explanation for the high retail margins.”

Pressure from the ACCC over claims of price gouging combined with low fuel price meant less went to lining the pockets of retailers in the quarter, with the profit margin falling 2.8 percent to 9.8cpl.

According to the report, Brisbane’s drivers paid the most at the pump over the March quarter, forking out an average 114.8 cpl, 4.8cpl higher than the average of the four other largest cities.

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“The high relative retail prices in Brisbane are likely to reflect inadequate competition at the retail level. It is to be hoped that greater price transparency can affect the high petrol prices and profits in Brisbane over coming months,” the ACCC said.

As with petrol prices, the cost of diesel in the five largest cities “decreased significantly” in the March quarter, the report said.

Diesel prices in the quarter averaged 113.7cpl – a fall of 11.8 cpl compared with the previous quarter, and the lowest since the June quarter of 1999 in real terms, the ACCC said.