The ACCC’s September quarterly report on the Australian petroleum industry reveals how much money motorists can save by avoiding buying petrol at the peak of the price cycle.
ACCC analysis has found if motorists in Sydney had simply avoided buying E10 on the six days around the price cycle peaks in the previous six months, they would have paid on average around 2.6 cents per litre (cpl) less.
Assuming similar savings for the other types of petrol (i.e. regular unleaded petrol (RULP) and premium unleaded petrol), the estimated overall savings for Sydney motorists over a year would be in the region of $85 million.
Analysis of other large cities shows:
- estimated savings in Melbourne are in the region of $75 million, with average RULP prices 2.3 cpl lower
- estimated savings in Brisbane are in the region of $40 million, with average RULP prices 2.4 cpl lower
- estimated savings in Adelaide are in the region of $30 million, with average RULP prices 3.3 cpl lower.
“Motorists who fill up weekly can make substantial savings by avoiding the six most expensive days in the price cycle,” ACCC Chairman Rod Sims said.
“Motorists that can fill up less frequently, however, and therefore buy petrol when prices are falling can save much more.”
“For example, avoiding buying petrol on the 10 days around the price cycle peaks would see motorists save 3.8–6.1 cpl in the capital cities. This would see annual savings of $141 million in Sydney, $124 million in Melbourne, $68 million in Brisbane and $55 million in Adelaide,” Mr Sims said.
“For those seeking to save money a little effort can see large savings.”
“Our advice for those looking to save even more, say 15–20 cpl, or $9–12 a tank, is to time your purchases by using the price cycle advice on the ACCC website, then use fuel price transparency apps or websites to find the most competitive fuel price near you,” Mr Sims said.
“There can be significant price differences between sites at different points in the price cycle, so motorists that shop around can save themselves a lot of money.”
Use of these apps and websites is particularly relevant to those motorists in the larger cities which have petrol price cycles.
The ACCC’s report found that average petrol prices fell by 2.7 cpl in the quarter. Retail margins also decreased to their lowest levels in real terms since the March quarter 2016.
The average petrol price in the five largest cities (i.e. Sydney, Melbourne, Brisbane, Adelaide and Perth) was 122.5 cpl in the September quarter 2017.
“Despite an increase in international refined petrol prices, influenced by the activities of the OPEC cartel, an increase in the AUD-USD exchange rate in the quarter meant that prices at the pump decreased to their lowest levels since late 2016,” Mr Sims said.
Retail prices in Brisbane were again the highest of the five largest cities, with an average price of 124.7 cpl, which was 2.7 cpl higher than the average across the other four largest cities. The ACCC released its report into the Brisbane petrol market on 9 October.
“That report found that retailers in Brisbane achieved higher margins and profits due to weak retail competition,” said Mr Sims.
In Launceston, Armidale and Cairns, retail prices remained above a long-term competitive cost-based price in the September quarter 2017, while prices in Darwin remained around a long-term competitive cost-based price. However, in late October 2017 Darwin prices increased significantly despite little change in wholesale prices.
“While the unjustified recent increase in prices in Darwin is disappointing, motorists can use the various websites and apps to find the cheapest price. We welcome the increased transparency in the Darwin market following the introduction of the My Fuel NT website and encourage motorists to use the service to shop around,” Mr Sims said.
The report is available: Quarterly report on the Australian petroleum market – September quarter 2017