Aussie Motorists Enjoy 17-Year Petrol Price Low

The cost of living in Australia is notoriously high, but thanks to a global crash in oil prices, filling up tanks is cheaper than it’s been in 17 years. Earlier this month the Australian Competition and Consumer Commission (ACCC) released a report confirming that petrol prices were at their lowest point since 1999, with the average cost of filling up a tank sitting at just US$81.4 cents per litre throughout the March 2016 quarter. This represents a drop of almost 10 cents from last year’s figures.

The perfect petrol price storm

According to ACCC Chairman Rod Sims, there are a number of factors at play. The global drop in crude oil prices is a major influencer, as well as stricter regulations enforced by the nation’s retail watchdog. Sims maintains that thanks to intervention from the ACCC, retailers were forced to bring down their margins and pass on low global fuel prices to Australian motorists.

"The low petrol prices were due to two main influences: Firstly, crude oil prices and international refined petrol prices in inflation adjusted terms fell to lows not seen since 2002 and 2008, respectively," explains Sims. "Secondly, gross retail margins decreased in the quarter. The ACCC believed that retail margins were unreasonably high in the second half of 2015 and wrote to the major petrol retailers in early February 2016 seeking an explanation for the high retail margins."

Consumer apps spark competition

Another keynote factor was the launch of new petrol price apps released during the March quarter. This includes the innovative 7-11 app, which allows users to hone in on the closest five 7-Eleven fuel retail sites in their local area. They can then find the cheapest price, lock it in and then redeem the rate at any nationwide 7-Eleven petrol station within seven days.

"This will allow consumers to make better informed purchasing decisions and reward retailers who discount prices, therefore promoting greater price competition in petrol markets," praises Sims. "This should also lead to downward pressure on retail margins."

So where’s the cheapest place to fill up? In March, Sydney’s stations were retailing fuel at US$79.2 cents per litre. Motorists in Canberra and Tasmania lumped higher prices, with fuel going for 89.6 cents per litre throughout 2016’s first quarter.

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