How low will petrol go?

Fuel hasn’t been this cheap for 20 years but it could drop even more in some places, writes

PETROL prices plunging towards 20-year lows are prompting motorists to wonder just how cheap our fuel can get.

The answer, according to those in the know, is not too much further in the capital cities where fuel has already dipped below 90c a litre.

Other capitals and regional areas still have some way to go, and pump prices are likely to stay low for months.

The cost of filling a family car or SUV has already dropped about $30 since last year.

Anthony Keane

While negative crude oil prices grabbed international headlines late last month, the current oil price near $US20 a barrel only represents about 20 per cent of the retail cost of a litre of fuel.

Australian Competition and Consumer Commission chairman Rod Sims said government fuel excise plus GST – currently totalling about 50c per litre – ensured there was a floor on pump prices.

“I doubt we will get, on average, prices much below 80c,” he said. “I don’t think they have got much further to fall in places like Sydney, Adelaide and Perth.”

Several Brisbane sites last week dropped petrol to the mid80c range but were jumping back towards $1.20 by the weekend.

Melbourne prices averaged around 90c, and in smaller cities such as Darwin, Hobart and Canberra prices were still above $1.10 and were taking “way too long” to drop, Mr Sims said. He said the ACCC had been calling out slow-to-act petrol retailers in metropolitan and regional areas.

Mr Sims said that, combined with public pressure, should force prices lower in places that still charged more than $1.20.

Motorists should also use government or commercial price-monitoring apps and websites to check for the cheapest fuel.

In several cities last week there were price differences between retailers of 40c a litre.

“You can certainly save money by using those apps,” Mr Sims said.

“It doesn’t take too long once you go through the effort to download them.”

Motorists should understand that the most expensive prices were charged by service stations in the most convenient locations, Mr Sims said.

“We have a monitoring role given to us by government – we have no price control powers,” he said.

Based on 92.4 cents per litre 49.6 cents

20.0c 12.5c 10.3c