The ACCC has released its latest Report on the Australian Petroleum Market, which notes that average petrol prices are tracking at the highest level since September 2015:
Chart 3.1 shows that seven-day rolling average retail petrol prices in the five largest cities decreased from a high of 132.0 cpl in early-May 2017 to a low of 116.4 cpl in early-July 2017.11 Prices subsequently increased to a high of 144.5 cpl in mid-December 2017 and decreased to 136.1 cpl at the end of December 2017.
In the March quarter 2018, prices increased from 133.8 in early-January 2018 to 140.7 cpl in late-February 2018. Prices subsequently decreased to a low of 129.4 cpl in mid-March 2018 before increasing to 140.5 cpl at the end of March 2018.
Average prices in the March quarter 2018 were 135.5 cpl, an increase of 0.4 cpl from the December quarter 2017 (135.1 cpl). In real terms, average prices in the March quarter 2018 were the highest since the September quarter 2015 (138.5 cpl).
However, petrol prices in Australia are largely mirroring the Singapore Mogas 95 Unleaded (Mogas 95) benchmark, suggesting no gouging of consumers:
Chart 3.2 shows that retail petrol prices in the five largest cities and Mogas 95 prices in Australian cents per litre moved in a broadly similar pattern in the year to March 2018. This indicates that, in aggregate, changes in domestic retail prices are primarily driven by changes in the international price of refined petrol.
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That said, consumers in Brisbane are paying the highest prices – a situation that has existed for the last eight years:
Chart 3.3 shows quarterly average retail prices in Brisbane and average prices across Sydney, Melbourne, Adelaide and Perth over the two years to March 2018. Over this period Brisbane retail prices were on average 3.2 cpl higher than the average across the other four largest cities (ranging from a high of 5.2 cpl in the June quarter 2016 to a low of 1.3 cpl in the September quarter 2016).
In the March quarter 2018, average retail prices in Brisbane were 138.2 cpl, which was 3.4 cpl higher than the average across the other four largest cities. This was 0.9 cpl lower than the differential in the December quarter 2017 (4.3 cpl).
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
