Petrol prices fall for the first time in almost two years, claims ACCC

The average retail petrol price in Australia’s five largest cities fell by 10.3 cents per litre, according to the Australian Competition and Consumer Commission (ACCC).

It says this is the first time the price of petrol has fallen during the third quarter of the year in almost two years, with the second quarter average of 177.7 cents per litre dropping to 167.4 cents per litre.

According to the ACCC, this reflects a 34 per cent drop in international petrol prices, weaker global demand, and concerns about a global recession.

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This is despite the return of the full fuel excise amount on September 29, 2022 – although this is likely to be reflected in the fourth quarter report, as the excise is applied to wholesale fuel, which feeds through to retail prices after a lag period.

This week, the Australian Institute of Petroleum reports the average national metropolitan average for unleaded petrol is 171.9 cents, up from 161.1 cents in the week before the fuel excise cut was removed.

The cut was caused by the Russian invasion of Ukraine in early 2022, with high fuel prices throughout March leading to a 21.1-cent reduction for six months.

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It isn’t good news for diesel, though. While petrol has fallen, average diesel prices at the bowser remain significantly higher than the average petrol prices in Australia’s five largest cities.

This is due to the full restoration of the fuel excise, an increase in wholesale diesel prices, its broader use in industrial activity and electricity generation, and stockpiling for the higher demand for heating in the Northern Hemisphere's winter.

In the six weeks following the excise restoration, average diesel prices in the capital cities increased by between 29.0 cpl (in Hobart) and 37.6 cpl (in Perth), while the average increase regionally was approximately 32 cpl.

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Fuel pump bowser

Following the restoration of the full fuel excise, the ACCC says it communicated with the industry, state and territory governments, and consumers to outlay its expectations about price increases, which it monitored for six weeks.

This monitoring has shown that petrol prices have increased, but “by less than the expected 25.3 cpl from the excise restoration” in metropolitan areas.

However, the ACCC said 18 regional locations saw price increases above 25.3 cpl, with further examination underway in these areas.

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“We have looked at the impact of the excise being restored, and, allowing for movements in international prices and the price cycles in the major cities, we found only a small number of unexpected increases in average retail petrol prices,” said the ACCC Commissioner, Mick Keogh.

It has also called on the Victorian Government to implement a fuel price transparency scheme, following the ACT’s move in early November to implement the NSW fuel price transparency scheme.

“This is welcome news for motorists in the ACT, who can now access real-time and comprehensive fuel price information through the NSW FuelCheck app and website,” added Keogh.