Fuel Prices - Time to Regulate (Poll) ?

megaclix on 09/03/2024 - 23:30

Are we just sick and tired of the fuel price swings in Australia?

Why is nothing done about it? Why do we put up with it? No other country does.

I've been following fuel prices in Australia since the GFC, when the retail price swing was only around 20c.

It is apparent to me that a lot of consumers are just confused with fuel prices (maybe bamboozled is a better word) and the fuel companies like it that way.

As I try to educate anyone interested, I use the aip website as a guide to the current wholesale price of fuel.

https://www.aip.com.au/pricing/terminal-gate-prices

This takes account of international fuel prices (that we have no control over), exchange rates, fuel excise etc. That is what it is.

However, we then have a retail price swing of up to 50c above this price. This is why we end up with situations where it is $1.80 one day, and people are shocked when it is $2.40 the day after.

I assume people in WA are still happy because they have a weekly price swing, so this can be managed.

East coast, the story is different, with price swings anywhere between 3 to 5 week cycles.

So, let's gauge where people are at.

If a politician was to propose to stabilise fuel prices, would you vote for them?

By stabilise prices, I would expect that a 14c to 17c margin per litre would be established. There would be no 50c retail price swing, but a price that would track at approx 15c above the aip price.

Let's keep political party allegencies out of this for now.

Poll Options expired

  • 22
    Don't care
  • 44
    EV driver, remind me what a petrol station is again.
  • 56
    No, I'm OK with the price swing
  • 288
    Yes, I would vote to stabilise fuel prices.
Automotive Fuel

Comments

  • AngoraFish on 10/03/2024 - 00:15
    +22

    So, basically, you'd be happy if the price of petrol stayed around $2.25-$2.40?

    No thanks. I think I'll take my $1.80 per litre as a bonus and accept that sometimes I won't be able to lock in something at 7/11 better than $2.40.

    • megaclix on 10/03/2024 - 00:19

      How did you get $2.25-$2.40?

      It would be $1.95 based on current AIP price +15c.

      • AngoraFish on 10/03/2024 - 00:40
        +16

        There's nothing mystically objective about terminal gate prices, it's just an average.

        This comes up every time there's a big upwards swing and the psychological anchoring effect makes your brain hurt for a few minutes.

        So, inevitably, out come the arguments that the gubmn't needs to introduce price controls to lock down petrol prices at the lower end of the price range. Today, you are that person, congratulations.

        The reality is that if price controls are introduced, retailers will make sure that they can still make money by locking down a base-line price at the upper end of the normal range.

        Have a look around and see how many millionaire petrol station owners you can find, in a shrinking industry due to the increasing proportion of EVs on the road. You won't find very many.

        In fact, your arbitrary 15c or so figure might just end up sending a fair few operators broke, reducing competition further.

        • megaclix on 10/03/2024 - 00:45
          +2

          Terminal gate price is the wholesale price, nothing mystical about it. Never claimed there was.

          The issue is the retail price swing of -4c to +54c around the AIP reported average wholesale price.This is unique to Australia.

          • AngoraFish on 10/03/2024 - 00:49
            +3

            @megaclix: No retailers make money with a 15c margin on terminal gate prices. All their margin is taken when prices are at the upper end of the range. At the bottom of that range they're just treading water. This is why prices creep up for a bit until competition brings the retail price down again, and so it goes.

            Don't be that guy who buys petrol at the top of the range.

            • Hardlyworkin on 10/03/2024 - 05:32
              +2

              @AngoraFish: Retailers make money from all that chocolate and lollies that you buy. It's seems that you've spent a bit too much time at a petrol station inhaling the fumes.

      • elgrande on 10/03/2024 - 12:46

        Your completely overlooking the reason it cycles.

    • Mugsy on 10/03/2024 - 08:14
      +3

      The question is not being able to lock in a better price at 711 moreso being able to use it when you need it… stupid 25c max discount.

    • HeWhoKnows on 10/03/2024 - 17:23
      +1

      Government intervention always pushes prices HIGHER!

      And there have been multiple inquiries into petrol pricing already.

      Better to let local competition take care of prices.

      And use the 7/11 Fuel price lock when ever it works out cheaper.

      Besides OB doesnt have any choice in the matter nor any influence.
      So whats the point of debating this here?
      Its just another "hypothetical"

      • smartazz104 on 12/03/2024 - 07:03
        +1

        Better to let local competition take care of prices.

        Comedy.

  • Hybroid on 10/03/2024 - 00:21
    +23

    Wouldn't restricting increases lead to higher end prices in general with less incentive to lower them? At least people can benefit from the down swing. I tend to fill up my ~150L at the $1.75 mark which keeps me going for a while. Haven't needed to pay $2.30 ever yet.

    • megaclix on 10/03/2024 - 00:34
      -4

      Price wise, I would guess that the competition would float around +13 to +17c above the wholesale price (I am basing that of UK margins which does not have the retail price swings).

      You having a 150l tank gives you flexibility to take advantage of the lower end of the price swings.

      This is why I'm doing the poll. The media are useless on this stuff.

      • askbargain on 10/03/2024 - 00:36
        +3

        Ever heard of a Jerry can?

        • Sammy2000 on 10/03/2024 - 10:03

          Haven't needed to do this yet. Doesn't the fuel go off?

          • bamzero on 10/03/2024 - 13:02
            +2

            @Sammy2000: You have some time, and depends on storage conditions.

            From BP

  • RED27APPLE on 10/03/2024 - 00:48
    +1

    Welcome you have entered SE QLD! This swing you are referring to has been going on for as long as I can remember………you’ll get used to it! Buy Low is the only way to go

    • Hedgehog on 10/03/2024 - 07:41
      +2

      And purchase a 20litre ‘bucket’ from SCA to have a bit of spare on hand is wot I do in case the cycle lengthens as it does sometimes.

  • Euphemistic on 10/03/2024 - 07:46
    +6

    Im not sure gov regulation of spmething like fuel is a good idea. IMO it would only increase the cost overall, especially if the oil lobbys get hold of the negotiation process. Better to have some market competition.

    • megaclix on 10/03/2024 - 10:05
      -3

      I'll admit myself, actually controlling the price by regulation long term would be undesirable.

      I'm just advocating to get rid of the retail price swing. I find it annoying that people have to plan around this, or just suck it up.

      Competition would still occur, but the difference would only be a few cents.

      • freefall101 on 10/03/2024 - 13:37
        +1

        What's the difference between retail price swing control and price control? The difference seems pretty meaningless when terminal gate pricing is already regulated as well.

        I think you're dreaming thinking pricing would wind up being a 14-17c above TGP. For some places it would just be easier to close up on a public holiday or long weekend due to the extra salaries. TGP is just the cost of the fuel, not transportation to the store, wages, all the costs of running the store, etc.

        What would happen is that fuel prices would be permanently higher and there'd be less interest on opening on a public holiday. Which is worse for everyone overall. If you don't like pricing, don't buy the petrol or hunt around for a cheaper price. Or open your own discount petrol station. Just look at how busy costco is right before a long weekend.

        • megaclix on 10/03/2024 - 15:17
          +1

          The average margin per litre in the UK is around 8 pence per litre.
          There is no retail price swing in the UK, or in the US (or anywhere else for that matter).

          The average margin in Australia is around 15c per litre, so around the same. The difference is Australia has this price swing for some reason. Competition can and does happen without the retail price swing.

          The poll is currently tracking 3 to 1 in favour of a stabilised price, so obviously people are sick of it. Are our motoring bodies doing us a disservice on this (e.g RACQ, NRMA RACV etc)?

          • freefall101 on 10/03/2024 - 18:46
            +1

            @megaclix: That means should probably be looking at why the rest of the world doesn't have price swings if we do. Because the US doesn't have price controls around petrol, it varies massively over the whole country.

            And when you say margin per litre, are you comparing apples to apples? Margin usually includes a lot more costs than just wholesale fuel prices when bought in volume.

            And an internet poll is worth about as much as a toothbrush made of ants. Ask people if they want to pay less they'll always say yes. How about asking if people would pay more in taxes to have a more stable fuel price?

  • JIMB0 on 10/03/2024 - 09:51
    +1

    I'd rather fill my jerry cans at the bottom of the cycle with various extra discounts on top. I'm sure the retailer is making a loss on me.

    • deme on 10/03/2024 - 20:23
      +3

      Careful, storing too much petrol in your house is a fire risk and will void your insurance

  • pegaxs on 10/03/2024 - 10:02
    +7

    I know, yeah… Sometimes my fuel price is $1.32/kWh… sometimes it's $0.18/kWh. Sometimes they pay me to fuel in my car. I cant handle the wild swings.

    • mskeggs on 10/03/2024 - 11:55
      +4

      Please think of the 70 series drivers in Sydney who need off road capability to reach the big4 park every xmas.

    • payless69 on 10/03/2024 - 12:58
      +1

      India has the fuel density displayed on every bowser along with the latest delivery docket showing what density got delivered at what temperature and when.
      Better to become an EV hater by default?

  • GordonD on 10/03/2024 - 10:40
    -1

    Perhaps the fuel industry players would like the government to somehow shut down fuel price cycles.

    As it stands they have to drop their prices as soon as their competitors do, or have all their customers desert them, potentially permanently. And they have to raise their prices as soon as their competitors do to maintain profitability. Neither fuel suppliers or service stations are making big profits.

    Maybe they'd be better off if they were stopped from this commercially self-destructive sheep-like behaviour.

    • deme on 10/03/2024 - 20:31
      +2

      Neither fuel suppliers or service stations are making big profits.

      Are you lying or ignorant.

      Ampol made record profits. Q4 2023 net profit margin was up 417.02% YoY.

      BP made $4 billion in profits, in Q3 2023 alone! Up 324% YoY

      Seven Eleven had net income of 101B JPY for the quarter ending November 2023.

      • GordonD on 10/03/2024 - 21:13
        -4

        Oh, you again.

        Either learn to respond to other peoples postings in a civil way, not with abuse, or go away and find some other forum where you can satisfy your need to insult other people.

  • datscheap on 10/03/2024 - 11:10
    +1

    90% of our fuel is imported from Malaysia, Singapore, South Korea and China.
    Yep, we are being gouged but its come a long way to get here, plus refining and local transport its still cheaper then bottled water.

    It sucks that one of our bigger household expenses has all its profits going overseas.

    News article with source:
    https://www.theguardian.com/australia-news/2022/apr/21/over-…

    • donman92 on 11/03/2024 - 12:09

      What's stopping us from making our own fuel?

      • Roentgenium on 11/03/2024 - 19:42
        +1

        the same thing that stops us making cars here, it's no longer commercially viable

  • Navanod66 on 10/03/2024 - 11:22

    WA price swings are now fortnightly

    • megaclix on 10/03/2024 - 15:24
      +2

      That's how it starts. Before you know it, WA will be on monthly cycles, peaking around holiday weekends.

    • bamzero on 10/03/2024 - 20:08

      Nah, weekly. They did try to go to fortnightly for a while but it slid back to weekly (filling up jerrys to ride out the second week was a PITA)
      Not counting diesel or LPG of course which doesn't seem to be on any particular cycle.
      https://www.fuelwatch.wa.gov.au/retail/price-trends

    • us3rnam3tak3n on 11/03/2024 - 16:40

      I haven't noticed anything other than the weekly cycle in WA. I fill up fortnightly, usually Tuesday at the bottom of the cycle. Last 12 months I have averaged 169 c/L.

      (166, 167, 167, 154, 166, 152, 169, 179, 177, 173, 190, 193, 190, 179, 179, 162, 152, 158, 162, 154, 160, 172, 164, 181, 167)

      For those that don't know, the next day's prices are published every day at 2:30pm. Change occurs at 6am and can't be altered for 24h.

      I think it works well, except that the Tue-Wed jump can be 40-50c sometimes.

  • shaybisc on 10/03/2024 - 12:12

    Where do they regulate petrol price? Only place I know of is Venezuela and it's not working out so good.

    Oh, Iran, Libya, Angola, Algeria. Yes, let's do what they do. It's clearly a winning policy.

  • Dollar General on 10/03/2024 - 13:02
    -2

    Don’t bring that commie talk here

    The best cure for high prices, is high prices

  • Fredfloresjr on 10/03/2024 - 15:09
    -2

    Trump for President

  • doctordv8 on 10/03/2024 - 21:29
    +1

    In one breath - less price swing is easier to manage, then…..yet I also respect it is just another Retail Product.

    My choice when and how much to use/buy/or chase discounts, and I manage this quite easily almost without an issue.

    Now if the Retailers were breaking the Rules, hell yes, go for it… nail 'em to the wall, as well as the Government if not managing the issue.

    Do you perhaps drive a gas guzzler and or drive excessively more than the average?

    Still running LPG on a 1200 Ute….. so that vehicle does not come into the discussion.

    But the bigger jobbies do their fair share of drinking.

    • megaclix on 11/03/2024 - 08:24

      I don't have a gas guzzler. Used to have a Territory, which did drink it's fair share. Now I have a 1.5l turbo, but the tank is generally smaller to go with it.

      And, I do get the benefit of using Costo, so thankfully for me I get to skip this fuel price cycle silliness most of the time.

      However, when I do get caught out, and end up with an empty tank away from Costco, and I have to buy at the top of the cycle, that is annoying. That is what reminds me what it is like for most people who do not have a local Cosco.

  • Piratarzt on 10/03/2024 - 22:16
    +1

    Price control introduces a whole bunch of unintended consequences. It also tends to outpace the national budget.

  • miwahni on 10/03/2024 - 22:25

    While I'm all for lower fuel prices, I would not vote for a politician who promised to stabilise the price of fuel. Most industries do better without government intervention. Once the government started dictating fuel prices, what is there to stop them from stepping into other contentious areas? Companies exist to make a profit. Take away the profitability and you take away the companies and eventually the industries.

  • Seaeagles on 10/03/2024 - 23:25
    +2

    Let the government take control and the price will sit at $2.50 and keep rising without ever dropping.
    Will also create an over inflated office with 100's of overly paid bureaucrats to oversee it all.

  • Herbse on 10/03/2024 - 23:27
    -1

    Sounds a little too forward thinking and socialist for most of the voting age boomers to accept.

  • trapper on 11/03/2024 - 00:02
    +3

    Very hard to believe there is no collusion going on with fuel pricing in Australia, they just need to stamp this out.

  • SydBoy on 11/03/2024 - 00:22

    As much as I support the party who will regulate fuel prices the fact is that it is impractical for government to control profit of a privately owned entity in democratic country unless they start operating government owned and operated fuel station same as India and many other countries where government regulate fuel prices or has power to control it

  • morebunnings on 11/03/2024 - 07:49

    I find it really confusing that some weeks diesel will be 20-30c cheaper than petrol, and other weeks is 20-30c more than petrol.

    Shouldn't their prices be tied together?

    • Roentgenium on 11/03/2024 - 19:47

      not even refined product is tied to crude oil.

      they're correlated to some extent but its not unusual for them to go in opposing directions

  • burningrage on 11/03/2024 - 08:38

    I think this is barking the wrong tree. Price swings have been around for yonks and why only now people are bickering about it?

    They should take a hard look at the Government for the every increasing excise. That's where you should bark.

    And also a bit rich to bicker about price control when Australia doesn't want to invest in fuel manufacture. Australia has an opportunity to source itself material for an EV revolution but I guess Australians won't be dragged out of the bed unless every worker is paid $1m per day.

    • megaclix on 11/03/2024 - 09:05

      Price swings have been around for yonks

      Yep, the retail price swing has been around for ever. It used to be very predictable on a short weekly cycle (east coast), which was easy to manage and take advantage of.

      But then the east coast retail cycle has stretched out to anywhere from 3 to 5 weeks. It used to be a price swing of 18c, and now it is 50c.

  • R4 on 11/03/2024 - 09:19

    Shop around. There are fuel stations in your area that are radically cheaper than the most expensive. Use an app or website like Fuel watch. Join Costco as they are nearly always the cheapest. If you don't, the fuel stations near Costco will be cheaper than average because they have to be to compete.

    Play the game. Don't be a victim.

    • bamzero on 11/03/2024 - 11:17
      +1

      Always good advice though I don't think the other states have it like we do in WA. No next days price locked in for 24 hours and reported by 2:30pm and having a longer than 1 week cycle makes it hard to buy at the bottom of the cycle.

      Seems most states have some sort of mandatory price reporting now at least except for VIC which still refuses so I guess need to rely on crowd driven reporting there.

      Costco is good for diesel but the one near me wouldn't be worth the drive out there for ULP as usually works out about the same or better at Woolies branded with vouchers and discounted gift cards

      • R4 on 11/03/2024 - 11:32
        +1

        Yes, Fuelwatch is a fantastic resource. I'm fortunate in that Costco Perth Airport is on my drive to and from work, so it's no extra expense to get fuel there. The big Atlas fuel station nearby on Great Eastern Highway is usually only a few cents more than Costco, so great if you didn't have Costco membership. Costco is also much cheaper for 98.

  • Pufff on 11/03/2024 - 09:38
    +1

    I find it mind blowing how in the 00s when petrol hit $1 there was a big shift to small cars. Present day its pushing $2 or more but there's a shift to massive suvs, utes etc. WTF is going through people's heads?

    • shaybisc on 11/03/2024 - 09:45

      "WTF is going through people's heads?"

      Must be the cost of living crisis.

      • Pufff on 11/03/2024 - 10:49
        +1

        trying to fix it by getting large cars?

  • gromit on 11/03/2024 - 09:56
    +1

    Government regulation here would only result in higher average prices as the price would need to be set where petrol stations can make money afterhours and on public holidays otherwise they just all close up outside of business hours rather than lose money. I would far prefer the swings where I can choose to pay on the cheaper days of the week as opposed to always paying more.

    and FYI it is highly amusing people using UK as a good example of being better. The UK makes what we are paying look cheap.

  • dazza826 on 11/03/2024 - 10:58
    +1

    No massive price swing/cycle = Canberra fuel market.

    It doesn't result in lower prices.

    Prices are always much higher when x state has a low or mid in their price cycle.

    Prices are stagnent most of the time.

    There's not much competition except a few outliers ie costco etc.

    When tgp/oil goes up the prices go up quickly, when these go down it takes ages for fuel prices to drop.

    • JDMcarfan on 11/03/2024 - 12:20
      +1

      yep this is exactly it
      and then literally everyone fills up as they swing by the airport costco/woolies and local competition/business elsewhere is eroded

  • mirz on 11/03/2024 - 11:37

    I love Costco for fuel, 25-30 cents savings per liter.

    majority of people in Australia have too much money and don’t care about fuel prices.

  • Dack Smith on 11/03/2024 - 12:55
    -1

    I do think the government needs to completely regulate the fuel market and drop the prices down to something like 1.40 or lower.

    They need to send an ultimatum to the countries we import from - drop the prices or we will economically sanction you.

    Australia is a powerful country and should use its clout to bring about benefits for its people.

    I’m sure once we threaten military and economic actions, they will be willing to give us much cheaper oil

    It’s time Albo

    It’s time

  • DiscoJango on 11/03/2024 - 14:04
    +1

    Hey government, could you do things which benefit the public and not just corporate greed?

    No.

    Ok…

  • Jl3636 on 11/03/2024 - 15:01

    price driven by supply demand, most of all, US capital behind the scene

  • enthusiast on 11/03/2024 - 16:07
    +1

    The 'price cycle' is purely profit driven and supported and reported by business, media and sadly even RACQ etc.

    However there are independent and independently owned major brand service stations here on the Sunshine Coast that don't follow it - they only change prices when the delivery price changes. They don't cycle up and down like the corporate owned ones.

    If the ACCC was serious about helping the consumer I'm sure they could investigate.

    For now I encourage all those I know to support the independently-owned servos that are consistently fairer with the sell price.

    • R4 on 11/03/2024 - 16:23

      Costco don't follow the fuel price cycle either

  • jaybees on 11/03/2024 - 16:36

    FYI: 711 fuel locking now only discounts up to $0.25 discount per litre: https://www.9news.com.au/national/7eleven-fuel-lock-app-disa…

  • Thaal Sinestro on 11/03/2024 - 19:05

    Unfortunately, the Feds cannot fix prices, just like they cannot socialize property. They tried to get the authority twice in 2 referendums but failed; capitalist indoctrination among the populace is all-pervasive and very hard to overcome. I would like to see the price of all essential goods and services fixed. Fuel, electricity and internet are easy to fix. Fixing prices individually for every item in a supermarket is time consuming, so probably it would be better to fix the maximum allowed markup. Fixing housing prices would be even more difficult.

  • Stickout on 11/03/2024 - 19:29

    The role of the govt is to make sure there is no collusion among the resellers, if the govt jumps in and be a player, or worse, 'regulate' the price, you are assured to pay through the roof in the end, that's simply how socialism works.

  • Roentgenium on 11/03/2024 - 19:55

    you're aware we deregulated wholesale petrol prices in 1998 yeah?

    regulation of wholesale petrol prices were ineffective, what makes you think regulation of retail prices will be any different

    https://onlinelibrary.wiley.com/doi/full/10.1111/j.1467-8489…

  • Doobies on 11/03/2024 - 20:11

    We have a few independents in Perth now that don't follow the cycle. Here's an example of the whole of Feb for ULP. Independent vs BP for ULP.

    I think it's more criminal the gap between fuel grades. When I started driving it was ULP Price. PULP was ULP+6c and 98 was ULP+10c

    Date Ind BP
    1 176.9 203.9
    2 176.9 191.9
    3 176.9 183.9
    4 176.9 183.9
    5 176.9 183.9
    6 173.8 173.9
    7 173.8 219.9
    8 173.8 205.9
    9 173.8 195.9
    10 173.8 181.9
    11 173.8 181.9
    12 173.8 181.9
    13 172.9 172.9
    14 172.5 219.9
    15 172.5 205.9
    16 176.9 189.9
    17 174.9 184.9
    18 174.9 184.9
    19 174.9 184.9
    20 174.9 176.9
    21 174.9 221.9
    22 174.9 205.9
    23 173.9 193.9
    24 173.9 185.9
    25 173.9 185.9
    26 173.9 185.9
    27 173.9 177.9
    28 173.9 221.9
    29 173.9 209.9
    AVERAGE 174.57 193.04
    MAX 176.9 221.9
    MIN 172.5 172.9
    MAX-MIN 4.4 49
    • JDMcarfan on 11/03/2024 - 21:47
      +1

      the gap between grades is really quite triggering.
      as a kid when prices were ~75c, the gap was 4/6c for 95/98.
      20 years later fuel prices are about triple that and the gap is 17/25c.
      TGP spreads are 12/20c so the 5c additional spread is pure profit margin for the retailers (above the base margin they'd make on 91)
      you wonder why they love to market the premium fuels then (then again i'm filling up with 95/98 nearly all the time)

  • Antikythera on 11/03/2024 - 22:04

    these price swings are ridiculous.

    when i bought my car LPG was about 75c for about a year. then it dropped to 65c for about two years. then it slowly rose to about 90c over like two years where it has been sitting at 85c-90c for the last two years.

    ridiculous i say.

  • smpantsonfire on 11/03/2024 - 23:30

    I just filled up my car in Germany. Petrol is ~$2.95 AUD.

    • R4 on 12/03/2024 - 17:54

      Australia, for a western nation, is one if the cheapest places in the world to buy fuel

  • ayeleeyas on 12/03/2024 - 04:05

    Time to bring in Warren G?

    https://youtu.be/1plPyJdXKIY?si=6CjE6vHtIiY__3QX

    • senor cogswallop on 15/03/2024 - 20:04
      +1

      Just hit the eastside, of the CBD,
      gas tank on empty, pumps where they be?
      finally came across a servo named B-ripoff-P
      only pulled in to take a dump and a pee

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