report on the australian petroleum market june 2021
TRANSCRIPT
accc.gov.au
Date published
Subtitle
Report title
Date published
Subtitle
Report title
accc.gov.au
Report on the Australian petroleum marketJune 2021
September 2021
Australian Competition and Consumer Commission 23 Marcus Clarke Street, Canberra, Australian Capital Territory, 2601
© Commonwealth of Australia 2021
This work is copyright. In addition to any use permitted under the Copyright Act 1968, all material contained within this work is provided under a Creative Commons Attribution 3.0 Australia licence, with the exception of:
� the Commonwealth Coat of Arms
� the ACCC and AER logos
� any illustration, diagram, photograph or graphic over which the Australian Competition and Consumer Commission does not hold copyright, but which may be part of or contained within this publication.
The details of the relevant licence conditions are available on the Creative Commons website, as is the full legal code for the CC BY 3.0 AU licence.
Requests and inquiries concerning reproduction and rights should be addressed to the Director, Content and Digital Services, ACCC, GPO Box 3131, Canberra ACT 2601.
Important notice
The information in this publication is for general guidance only. It does not constitute legal or other professional advice, and should not be relied on as a statement of the law in any jurisdiction. Because it is intended only as a general guide, it may contain generalisations. You should obtain professional advice if you have any specific concern.
The ACCC has made every reasonable effort to provide current and accurate information, but it does not make any guarantees regarding the accuracy, currency or completeness of that information.
The ACCC obtains confidential proprietary data from Argus Media under licence, from which data the ACCC conducts and publishes its own calculations and forms its own opinions. Argus Media does not make or give any warranty, express or implied, as to the accuracy, currency, adequacy or completeness of its data and it shall not be liable for any loss or damage arising from any party’s reliance on, or use of, the data provided or the ACCC’s calculations.
Parties who wish to re-publish or otherwise use the information in this publication must check this information for currency and accuracy prior to publication. This should be done prior to each publication edition, as ACCC guidance and relevant transitional legislation frequently change. Any queries parties have should be addressed to the Director, Content and Digital Services, ACCC, GPO Box 3131, Canberra ACT 2601.
ACCC 09/21_21-76
www.accc.gov.au
iii Report on the Australian petroleum market – June 2021
ContentsPetrol snapshot – 2020–21 1
Key messages in 2020–21 2
Petrol snapshot – June quarter 2021 10
Key messages in the June quarter 2021 11
1. Developments in the petroleum industry 141.1 Demand for petrol remained lower than pre-pandemic levels 14
1.2 The Australian Government’s fuel security package became law 15
1.3 Ampol announced that it would continue refining operations at Lytton and participate in the fuel security package 16
1.4 Viva Energy also announced that it would participate in the fuel security package 16
1.5 Informed Sources’ undertaking expired 17
1.6 Motorists use of fuel price apps has been increasing 17
1.7 The Independent Pricing and Regulatory Tribunal released a draft report on ethanol in New South Wales 18
1.8 The transition from Caltex to Ampol sites continued 19
2. ACCC activities 202.1 ACCC and the petrol industry 20
2.2 Activities in the June quarter 2021 20
2.3 Report on petrol prices by major retailer in 2019 and 2020 22
3. Retail petrol price movements in the 5 largest cities 233.1 Retail prices in the 5 largest cities increased in the quarter 23
3.2 Retail prices remained relatively stable over the quarter 23
3.3 Annual average prices in the 5 largest cities in 2020–21 were the lowest in 22 years in real terms 24
3.4 The number and nature of price cycles in each city varied 25
3.5 Retail prices in Brisbane were higher than the other 4 largest cities in aggregate 26
3.6 Retail petrol prices in Australia were lower than in most OECD countries due to lower taxes 27
3.7 The price differential between premium and regular unleaded petrol remained high 29
4. Components of petrol prices in the 5 largest cities 314.1 Mogas 95 was the largest component of average petrol prices in the quarter 31
4.2 Taxes were the largest component of average petrol prices in 2020–21 32
4.3 Changes in Mogas 95 prices continued to significantly influence changes in retail prices 32
4.4 The AUD–USD exchange rate remained relatively stable in the quarter 33
4.5 Gross indicative retail differences were lower after record highs in 2020 34
4.6 Annual average GIRDs in 2020–21 were the highest on record 36
4.7 The increase in Mogas 95 prices was the main contributor to higher retail prices in the quarter 41
4.8 The higher AUD-USD exchange rate was the main contributor to lower annual average retail prices in 2020–21 42
iv Report on the Australian petroleum market – June 2021
5. Retail petrol price movements in the smaller capital cities and in regional locations 445.1 Retail prices in Darwin remained below prices across the 5 largest cities 44
5.2 Average regional prices were again lower than prices in the 5 largest cities 45
5.3 Relatively lower regional prices may reflect more stable petrol demand in regional locations as well as lag effects from increasing wholesale prices 46
5.4 Retail prices and GIRDs in Victoria 47
5.5 The difference between regional and city prices varies between jurisdictions 51
6. Crude oil and refined petrol price movements 566.1 Crude oil and refined petrol prices increased to their highest levels in over 2 years 56
6.2 The OPEC cartel and COVID-19 were the main factors influencing crude oil prices 57
6.3 Refiner margins increased but remained well below the 10-year average 59
6.4 Crude oil prices increased above the long-term average 59
7. Diesel and LPG prices 617.1 Retail diesel prices increased in the quarter 61
7.2 Gasoil 10 ppm was the largest component of average diesel prices in the quarter 62
7.3 Taxes were the largest component of average diesel prices in 2020–21 63
7.4 Retail LPG prices increased in the quarter 63
7.5 Other costs and margins were a relatively large component of average LPG prices in the quarter 65
7.6 Other costs and margins were also a relatively large component of
average LPG prices in 2020–21 66
Appendix A: Petrol price data for monitored locations 67
Appendix B: Update on regional market studies 73
1 Report on the Australian petroleum market – June 2021
ANNUAL AVERAGE RETAIL PETROL PRICES
COMPONENTS OF RETAIL PETROL PRICES IN 2020–21
GROSS INDICATIVE RETAIL DIFFERENCES
Other costs and margins (wholesale and retail)Taxes (excise and GST)International cost of refined petrol (Mogas 95)
GIRDs are the di�erence between average retail petrol prices and indicative wholesale prices in the 5 largest cities. They are a broad indicator of gross retail margins.
Breakdown of average petrol prices in the 5 largest cities.
DIFFERENCE BETWEEN REGIONALAND CITY PRICES IN 2020–21The di�erence between average retail petrol prices in over 190 regional locations and average prices in the 5 largest cities.
129.7 cpl
PETROL
19 25.2
54.3
50.2
42
39
cpl%
4.9
0.1
5.0
Perth
Hobart
Canberra
Sydney
Darwin
Melbourne
Adelaide
Brisbane 133.63.2
129.43.4
132.115.7
129.79.1
125.18.7
126.75.1
133.1 2.7
125.610.2
Regional locations 5 largest cities
129.7-2.1
6.1
5 largest cities
127.6
Retail prices
113.0 Wholesale prices
2019–202020–21
14.7GIRDs16.7
129.7134.6
119.9
2.0
Prices are shown in cents per litre (cpl). cpl change from previous financial year.References to ‘petrol’ are to regular unleaded petrol (RULP) in all capital cities except Sydney, where E10 prices (RULP with up to 10% ethanol) are used.
Petrol snapshot – 2020–21
2 Report on the Australian petroleum market – June 2021
Scope of this reportThe ACCC monitors retail prices of unleaded petrol, diesel and automotive LPG in all capital cities and in more than 190 regional locations across Australia.
This report analyses prices in the 2020–21 financial year and in the June quarter 2021.
Key messages in 2020–21
Annual average retail petrol prices were the lowest in 22 years in real termsIn 2020–21, annual average retail petrol prices in the 5 largest cities (Sydney, Melbourne, Brisbane, Adelaide and Perth) were 129.7 cents per litre (cpl), a decrease of 4.9 cpl from 2019–20 (134.6 cpl).1
The following chart shows that annual average retail prices in nominal terms were the lowest in 4 years (when annual average prices were 122.6 cpl in 2016-17). In real terms, annual average retail prices were the lowest in 22 years (when annual average prices were 115.0 cpl in 1998–99).
Annual average retail petrol prices in the 5 largest cities in nominal and real terms: 1995–96 to 2020–21
60
70
80
90
100
110
120
130
140
150
160
170
180
1995
–96
1996
–97
1997
–98
1998
–99
1999
–00
2000
–01
2001
–02
2002
–03
2003
–04
2004
–05
2005
–06
2006
–07
2007
–08
2008
–09
2009
–10
2010
–11
2011
–12
2012
–13
2013
–14
2014
–15
2015
–16
2016
–17
2017
–18
2018
–19
2019
–20
2020
–21
cpl
Nominal prices Real prices
Source: ACCC calculations based on data from FUELtrac and Informed Sources, and Australian Bureau of Statistics, 6401.0 Consumer Price Index, Australia, June 2021, Tables 1 and 2. CPI: All Groups, Index Numbers and Percentage Changes, at: https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/jun-2021/640101.xls, accessed on 25 August 2021.
Note: Real prices are shown in 2020–21 dollars.
1 In this report, ‘petrol’ means regular unleaded petrol (RULP) unless otherwise specified. From 1 July 2014, the ACCC has used E10 prices (i.e. RULP with up to 10% ethanol) instead of RULP prices for Sydney in the average price for the 5 largest cities. All prices in this report are nominal prices unless otherwise specified. Real prices means prices adjusted for inflation using the Consumer Price Index.
3 Report on the Australian petroleum market – June 2021
Daily average prices were relatively stable in the first half of 2020–21 and increased in the second halfDaily average prices (on a 7–day rolling average basis) in the 5 largest cities were relatively stable in the first half of 2020–21 following record low prices in April 2020.2 The following chart shows that between July and December 2020 7–day rolling average prices ranged between 112.4 cpl and 133.8 cpl.
Prices trended upwards in early 2021 and reached a high of 147.6 cpl on 30 June 2021. The last time 7–day rolling average retail petrol prices were at this level was on 18 February 2020.
Seven-day rolling average retail petrol prices in the 5 largest cities: 1 July 2019 to 30 June 2021
80
90
100
110
120
130
140
150
160
170
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Source: ACCC calculations based on data from FUELtrac.
Note: The area to the right of the dotted vertical line represents 2020–21.
Average retail petrol prices reflected movements in international prices International refined petrol prices (which are influenced by international crude oil prices) and the AUD–USD exchange rate, largely determine retail petrol prices in Australia. The price of Singapore Mogas 95 Unleaded (Mogas 95) is the price of refined petrol in the Asia-Pacific region, and is the relevant benchmark for the wholesale price of petrol in Australia.
The following chart shows that retail petrol prices in the 5 largest cities and Mogas 95 prices in Australian cents per litre moved in a similar pattern in the 2 years to June 2021.
2 A 7–day rolling average price is the average of the current day’s price and prices on the 6 previous days. Traditionally, the ACCC has used a 7–day rolling average to smooth out the influence of petrol price cycles in the larger cities on price movements. This has been less effective in recent years because the duration of price cycles in most of the larger cities has become substantially greater than 7 days.
4 Report on the Australian petroleum market – June 2021
Monthly average retail petrol prices in the 5 largest cities and Mogas 95 prices: July 2019 to June 2021
10
20
30
40
50
60
70
80
90
80
90
100
110
120
130
140
150
160
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
cpl
5 largest cities (LHS) Mogas 95 (RHS)
Source: ACCC calculations based on data from FUELtrac, OPIS, Argus Media and the Reserve Bank of Australia (RBA).
Note: The area to the right of the dotted vertical line represents 2020–21.
In 2020–21, monthly average Mogas 95 prices varied by 25.7 cpl (from a low of 40.4 cpl in November 2020 to a high of 66.1 cpl in June 2021). In comparison, monthly average retail petrol prices in the 5 largest cities varied by 23.2 cpl (from a low of 119.1 cpl in November 2020 to a high of 142.3 cpl in June 2021).
Annual average Mogas 95 prices in 2020–21 were 50.2 cpl, a decrease of 5.0 cpl from 2019–20 (55.2 cpl).
Crude oil prices increased during the year due to the OPEC cartel’s production cuts and recovering global demand In 2020–21, agreements made by the Organisation of the Petroleum Exporting Countries (OPEC) cartel and other crude oil producing countries, and the impact on demand of the COVID-19 pandemic, were the major influences on crude oil prices.
The agreement by OPEC and other crude oil producing countries (including Russia) in April 2020 to cut output led to a steady increase in crude oil prices to the end of June 2020. In November 2020 news of the roll-out of COVID-19 vaccines and a decline in the US dollar pushed crude oil prices higher.
Further OPEC production cuts and increasing global demand meant crude oil prices continued to increase in the March quarter 2021. The OPEC cartel was withholding around 8.0 million barrels per day in March 2021. In April 2021, OPEC and non-OPEC countries agreed to increase output marginally, by 0.35 million barrels per day in May and June, and 0.4 million barrels per day in July 2021. However, crude oil prices increased in the June quarter 2021 due to a recovery in demand and falling stockpiles in the United States.
5 Report on the Australian petroleum market – June 2021
Gross indicative retail differences were the highest on record in both nominal and real termsAnnual average gross indicative retail differences (GIRDs) in the 5 largest cities in 2020–21 were 16.7 cpl, which was 2.0 cpl higher than in 2019–20 (14.7 cpl).
GIRDs are a broad indicator of gross retail margins. The ACCC calculates GIRDs by subtracting average wholesale prices (as indicated by published terminal gate prices (TGPs)) from average retail petrol prices. TGPs are prices that wholesalers charge for petrol in the spot market.3 TGPs reflect the wholesale price of petrol only, and exclude other retail operating costs (such as freight, the cost to use a particular brand, rent, labour and utility costs). As GIRDs include these costs, they should not be confused with actual retail profits.
GIRDs are averages across the 5 largest cities over time. The level of prices, costs and profits vary significantly between retail operations and not all retail petrol sites will be achieving these gross margins. Some will be achieving higher gross margins, others lower. The ACCC’s petrol market studies published between 2015 and 2017 found that profits per retail petrol site could vary considerably between retailers, with some retail sites making substantial profits and others making very little.
The following chart shows that annual average GIRDs in 2020–21 were the highest in real terms since the ACCC began calculating them in 2002. They were also the highest in nominal terms.
Annual average GIRDs in the 5 largest cities in real terms: 2002–03 to 2020–21
0
2
4
6
8
10
12
14
16
18
2002
–03
2003
–04
2004
–05
2005
–06
2006
–07
2007
–08
2008
–09
2009
–10
2010
–11
2011
–12
2012
–13
2013
–14
2014
–15
2015
–16
2016
–17
2017
–18
2018
–19
2019
–20
2020
–21
cpl
Real GIRDs Period average (real terms)
Period avg: 9.5 cpl
Source: ACCC calculations based on data from FUELtrac, Informed Sources, Ampol, bp, Mobil, Viva Energy and WA FuelWatch, and Australian Bureau of Statistics, 6401.0 Consumer Price Index, Australia, June 2021, Tables 1 and 2. CPI: All Groups, Index Numbers and Percentage Changes, at: https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/latest-release#data-download, accessed on 25 August 2021.
Note: Real values are shown in 2020–21 dollars.
Despite GIRDs being the highest the ACCC has recorded, average retail prices in 2020–21 were relatively low. Changes in retail operating costs and profits primarily influence annual average GIRDs (which are a relatively small component of retail prices). Mogas 95 prices and taxes (which are larger components of retail prices), as well as movements in the AUD-USD exchange rate, influenced the lower annual average retail prices in 2020–21.
3 The major wholesalers post these prices on their websites on a regular basis. Although few wholesale transactions occur at TGPs, they are indicative wholesale prices. TGPs vary across brands and cities.
6 Report on the Australian petroleum market – June 2021
Petrol sales volumes remained below pre-pandemic levels The COVID-19 restrictions on travel and economic activity in Australia imposed in mid-March 2020 meant that there was significantly less petrol purchased from retail sites in the June quarter 2020, as shown in the following chart.
Quarterly sales volumes of regular unleaded petrol in Australia: March quarter 2019 to June quarter 2021
1,500
1,700
1,900
2,100
2,300
2,500
2,700
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
Mill
ion
litre
s
Quarterly avg: 2019
Quarterly avg: 2020
Source: Department of Industry, Science, Energy and Resources (DISER), Australian Petroleum Statistics, issue 299, June 2021 at: https://www.energy.gov.au/publications/australian-petroleum-statistics-2021, accessed on 25 August 2021.
In the first half of 2020–21, petrol sales volumes partially recovered as restrictions in parts of Australia eased. Quarterly average petrol sales in 2020 were 14% below quarterly average petrol sales in 2019.
Petrol sales volumes declined marginally in the March quarter 2021 (influenced by lockdowns in various jurisdictions), and were essentially unchanged in the June quarter 2021. They were still around 7% lower than quarterly average sales volumes in 2019 but around 8% higher than quarterly average sales volumes in 2020.
In 2020–21, annual petrol sales volumes were around 2% lower than in 2019–20 and around 11% lower than in 2018–19, before the impact of COVID-19.
The effects of COVID-19 on petrol demand contributed to the high GIRDs in 2020–21. Petrol retailing is a high-volume, low-margin business with many fixed costs (such as rent and the cost to use a particular brand). This means when sales volumes decline, the cost per unit of petrol will increase. To generate revenue to partially cover their fixed costs, some retailers may have been setting retail prices higher than they otherwise would.
Taxes were the largest component of petrol pricesThe 3 broad components of the retail price of petrol are: the international price of refined petrol (Mogas 95), taxes (excise and GST), and other costs and margins at the wholesale and retail levels.
In 2020–21, taxes were the largest component of annual average petrol prices in the 5 largest cities (42%) with Mogas 95 accounting for 39%. While taxes were the largest component, Australia has a relatively low rate of taxation on petrol compared with most other OECD countries.
The following chart shows the change in the components of average retail petrol prices in the 5 largest cities between 2019–20 and 2020–21. The chart separates the other costs and margins component into 2 elements: other wholesale costs and margins (which includes international shipping costs and other import costs, and wholesale costs and margins), and retail costs and margins (represented by GIRDs).
7 Report on the Australian petroleum market – June 2021
Changes in the components of annual average retail petrol prices in the 5 largest cities: 2019–20 to 2020–21
Mogas 95 Other wholesale costs and margins Taxes GIRDs
Other wholesalecosts and margins
55.2 50.2
11.810.0
52.952.8
14.716.7
0
20
40
60
80
100
120
140
160
2019–20 Mogas 95 Exchange rate Taxes GIRDs 2020–21
cpl
129.7 cpl+0.9 cpl
-5.0 cpl
+2.0 cpl-0.1 cpl-1.8 cpl-5.9 cpl
-4.9 cpl134.6 cpl
Source: ACCC calculations based on data from FUELtrac, OPIS, Argus Media, Ampol, bp, Mobil, Viva Energy, WA FuelWatch, RBA and the Australian Taxation Office (ATO).
Notes: All prices are in Australian cents per litre.
The taxes component includes fuel excise and wholesale GST. The small amount of retail GST is included in GIRDs rather than in taxes, to be consistent with GIRDs reported elsewhere in this report. As a result, the taxes component in this chart is not the same as the taxes component in the bowser in the Petrol snapshot – 2020–21.
The AUD–USD exchange rate is a significant determinant of Australia’s retail petrol prices because international refined petrol is bought and sold in US dollars in global markets. The chart shows that the decrease in annual average retail petrol prices in the 5 largest cities in 2020–21 (by 4.9 cpl) was primarily a result of the higher annual average AUD–USD exchange rate making Mogas 95 prices lower in AUD terms.
Excluding the effect of changes in the AUD–USD exchange rate (which increased by US 8.0 cents in 2020–21), average Mogas 95 prices would have increased by 0.9 cpl in 2020–21. The significant increase in the AUD–USD exchange rate, however, more than off-set the increase in the price of Mogas 95. This resulted in a net decrease in Mogas 95 prices in Australian cents per litre terms by 5.0 cpl.
Independent chains generally have the lowest retail prices in the capital citiesOn 8 June 2021, the ACCC released its second industry report under the current petrol monitoring Direction.4 The report examined annual average retail petrol prices in 2019 and 2020 to identify the highest and lowest priced major retailers in each capital city.
The report showed that the cheapest major retailer in 2020 in all 8 capital cities was an independent retail chain. These were: Speedway in Sydney, Metro Petroleum in Melbourne and Canberra, United in Brisbane, Adelaide and Hobart, Vibe in Perth and FuelXpress in Darwin. Lower priced retailers, including many of the independent chains, compete vigorously on price and provide an important influence on the level of price competition across the cities.
The report revealed that motorists in Australia’s 5 largest cities could have saved a combined total of nearly half a billion dollars in 2020 by switching from a variety of higher-priced to lower-priced retailers. The total potential savings in 2020 could have been around $216 million in Sydney, around $147 million in Melbourne, around $46 million in both Adelaide and Perth and around $31 million in Brisbane.
4 ACCC, Independent chains generally have the lowest prices - report on petrol prices by major retailer in 2019 and 2020, 8 June 2021, at: https://www.accc.gov.au/system/files/Independent%20chains%20generally%20have%20the%20lowest%20prices%20-%20report%20on%20petrol%20prices%20by%20major%20retailer%20in%202019%20and%202020.pdf.
8 Report on the Australian petroleum market – June 2021
Motorists can use information about the relative average prices of the major retailers in the report, in conjunction with other publicly available fuel price information, to help them make informed purchasing decisions.
Real-time fuel price data became available to more motoristsInformation to help motorists compare petrol prices across retailers is widely available. This includes real-time price data available through state and territory government fuel price transparency schemes, along with a range of commercial apps and websites.5
In 2020–21, real-time price data became available in a number of jurisdictions:
� In December 2020, the Queensland Government announced that motorists in Queensland would have permanent access to real-time fuel price reporting, following a 2-year trial that commenced in December 2018. Motorists can access fuel price data through a variety of fuel price apps and websites.
� In September 2020, the Tasmanian Government commenced its fuel price transparency scheme (FuelCheck TAS) and in December 2020, the Royal Automobile Club of Tasmania (RACT) introduced its Fuel Saver website and app.
– In June 2021, the Tasmanian Government noted that the combined downloads of the FuelCheck TAS app and the RACT’s Fuel Saver app had exceeded 53,000.
� In March 2021, the South Australian Government introduced its fuel price transparency scheme and, on the same day, the Royal Automobile Association of South Australia (RAA) introduced its myRAA app.
– In April 2021, the South Australian Government noted that the RAA’s real-time fuel app has been used more than 145,000 times since it launched.
Regional prices on average were lower than prices in the 5 largest citiesThe ACCC monitors fuel prices in all capital cities and over 190 regional locations across Australia. In 2020–21, annual average prices in regional locations in aggregate (regional prices) were 127.6 cpl, which was 2.1 cpl lower than average prices in the 5 largest cities (129.7 cpl). In comparison, in 2019–20 annual average regional prices were 4.0 cpl higher than average prices in the 5 largest cities, and in 2018–19 they were 6.5 cpl higher.
A couple of factors may have contributed to regional prices being lower than prices in the 5 largest cities in 2020–21.
Less frequent COVID-19 restrictions and lockdowns occurred in regional locations than in the 5 largest citiesPetrol retailers in the 5 largest cities, faced with a reduction in demand associated with various COVID-19 restrictions and lockdowns, may have been setting retail prices higher to partially cover their fixed costs. As demand may have been more stable in many regional locations, retailers in those locations may not have had the same incentive to increase their retail prices by as much.
5 Victoria and the Australian Capital Territory are the only 2 jurisdictions to not have a government fuel price transparency scheme.
9 Report on the Australian petroleum market – June 2021
Retail prices in regional locations generally took longer to reflect increasing wholesale prices from November 2020, compared with the 5 largest citiesWhile retail petrol prices in regional locations generally follow movements in wholesale prices, they often do not respond as quickly – either up or down – as do prices in the 5 largest cities. The frequency of retail site turnover of fuel influences these lags, which are longer in regional locations where volume turnover is smaller and the degree of competition is often not as intense.
The extent of the influence of these factors is likely to vary between regional locations. Differing levels of COVID-19 restrictions were applied across the country, and the length of lags varies among regional locations.
Average retail prices and GIRDs in ACCC regional market study locations were generally lower than in the 5 largest citiesThe ACCC undertook 4 regional petrol market studies between 2015 and 2017. These studies examined petrol markets in Darwin, Launceston, Armidale and Cairns. Following the completion of those studies, the ACCC continues to monitor prices and developments in those locations to assess changes in competition over time.
In 2020–21, annual average retail petrol prices in Darwin, Armidale and Cairns were lower than average prices in the 5 largest cities, and average retail prices in Launceston were marginally higher. Annual average GIRDs in all of the market study locations were lower than average GIRDs in the 5 largest cities.
Diesel prices were significantly lower and LPG prices were marginally higherIn 2020–21, annual average diesel prices in the 5 largest cities were significantly lower, while liquefied petroleum gas (LPG) prices were marginally higher:6
� annual average retail diesel prices were 126.3 cpl, a decrease of 15.5 cpl (or around 11%) from 2019–20 (141.8 cpl)
� annual average retail LPG prices were 82.5 cpl, an increase of 1.8 cpl (or around 2%) from 2019–20 (80.7 cpl).7
6 References to LPG in this report refer to automotive liquefied petroleum gas.
7 For petrol, the percentage change in 2020–21 was a decrease of around 4%. When comparing percentage changes it is important to bear in mind that, as noted in chapter 7, different international benchmark prices drive petrol, diesel and LPG prices in Australia and taxes are lower on LPG compared with diesel and petrol.
10 Report on the Australian petroleum market – June 2021
Petrol snapshot – June quarter 2021QUARTERLY AVERAGE RETAIL PETROL PRICES
COMPONENTS OF RETAIL PETROLPRICES IN THE QUARTER
GROSS INDICATIVE RETAIL DIFFERENCES
Other costs and margins (wholesale and retail)Taxes (excise and GST)International cost of refined petrol (Mogas 95)
GIRDs are the di�erence between average retail petrol prices and indicative wholesale prices in the 5 largest cities. They are a broad indicator of gross retail margins.
Breakdown of average petrol prices in the 5 largest cities.
DIFFERENCE BETWEEN REGIONALAND CITY PRICES IN THE QUARTERThe di�erence between average retail petrol prices in over 190 regional locations and average prices in the 5 largest cities.
142.0 cpl
PETROL
17 23.6
55.6
62.8
39
44
cpl%
8.6
0.3
0.9
8.0
Perth
Hobart
Canberra
Sydney
Darwin
Melbourne
Adelaide
Brisbane 146.811.2
143.610.8
146.412.7
142.210.3
139.913.5
139.99.6
144.5 8.3
135.23.1
Regional locations 5 largest cities
142.0-1.02.3
5 largest cities
141.0
Retail prices
127.2 Wholesale prices
Mar qtrJun qtr
15.8GIRDs14.8
142.0
133.4
117.6
1.0
Prices are shown in cents per litre (cpl). cpl change from previous quarter.References to ‘petrol’ are to regular unleaded petrol (RULP) in all capital cities except Sydney, where E10 prices (RULP with up to 10% ethanol) are used.
11 Report on the Australian petroleum market – June 2021
Key messages in the June quarter 2021
Quarterly average retail petrol prices were higher In the June quarter 2021, average retail petrol prices in the 5 largest cities were 142.0 cpl, an increase of 8.6 cpl from the March quarter 2021 (133.4 cpl). The increase in retail prices was primarily due to increases in international crude oil and refined petrol prices in the quarter.
Seven-day rolling average prices were 141.6 cpl at the beginning of the June quarter 2021, and fluctuated within a 10.0 cpl band before reaching a high of 147.6 cpl at the end of the quarter.
Higher international prices of refined petrol were the main contributor to higher retail pricesThe following chart shows the change in the components of average retail petrol prices in the 5 largest cities between the March quarter 2021 and the June quarter 2021.
Changes in the components of average retail petrol prices in the 5 largest cities: March quarter 2021 to June quarter 2021
Mogas 95 Other wholesale costs and margins Taxes GIRDs
54.8 62.8
9.510.1
53.354.3
15.814.8
0
20
40
60
80
100
120
140
160
Mar–21 Mogas 95 Exchange rate Other wholesalecosts and margins
Taxes GIRDs Jun–21
cpl +8.0 cpl
+8.6 cpl142.0 cpl
+1.0 cpl -1.0 cpl133.4 cpl
+0.6 cpl
+0.3 cpl+7.7 cpl
Source: ACCC calculations based on data from FUELtrac, Argus Media, Ampol, bp, Mobil, Viva Energy, RBA and the ATO.
Notes: All prices are in Australian cents per litre.
The taxes component includes fuel excise and wholesale GST. The small amount of retail GST is included in GIRDs rather than in taxes, to be consistent with GIRDs reported elsewhere in this report. As a result, the taxes component in this chart is not the same as the taxes component in the bowser in the Petrol snapshot – June quarter 2021.
The chart shows that the increase in average retail petrol prices in the 5 largest cities in the June quarter 2021 (8.6 cpl) was largely a result of the increase in the price of Mogas 95 (8.0 cpl).
Excluding the effect of changes in the AUD–USD exchange rate (which was marginally lower in the quarter), Mogas 95 prices would have increased by 7.7 cpl in the quarter. The small decrease in the AUD–USD exchange rate compounded the increase in Mogas 95 prices and resulted in Mogas 95 prices increasing by an additional 0.3 cpl in AUD terms.
In the June quarter 2021, Mogas 95 accounted for 44% of average retail petrol prices. The 2 largest components – Mogas 95 and taxes – accounted for 83% of average petrol prices.
12 Report on the Australian petroleum market – June 2021
GIRDs decreased for the third consecutive quarter but remained relatively highIn the June quarter 2021, average GIRDs in the 5 largest cities were 14.8 cpl, a decrease of 1.0 cpl from the previous quarter. This was the third consecutive quarter in which GIRDs decreased. Despite the decreases in GIRDs in the past 3 quarters, they remain relatively high compared with previous levels, as shown in the following chart.
Quarterly average GIRDs in the 5 largest cities: September quarter 2018 to June quarter 2021
8
10
12
14
16
18
20
Sep
–18
Dec
–18
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
cpl
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil, Viva Energy and WA FuelWatch.
The recent changes in quarterly GIRDs may partly reflect an increase in petrol sales volumes. In both the March and June quarters 2021, sales volumes were around 8% higher than quarterly average sales volumes in 2020 (although they were still around 7% lower than quarterly average sales volumes in 2019).
Another factor may be the environment of rising international crude oil and refined petrol prices. When TGPs increase by large amounts in a short period, lags between changes in TGPs and changes in retail prices often have the effect of reducing GIRDs in the short term.
Regional prices on average were lower than prices in the 5 largest cities for the fourth consecutive quarterIn the June quarter 2021, average regional prices were 141.0 cpl. This was 1.0 cpl lower than average prices in the 5 largest cities (142.0 cpl), and was the fourth quarter in a row when average regional prices were lower than average prices in the 5 largest cities.
In June quarter 2021, in the 4 locations where the ACCC undertook regional market studies:
� average retail prices in Darwin, Armidale and Cairns were lower than average retail prices in the 5 largest cities for the fourth consecutive quarter
� average retail prices in Launceston were marginally above prices in the 5 largest cities, after being lower in the March quarter 2021 quarter (for the first time since the ACCC released its Launceston market study in July 2016).
13 Report on the Australian petroleum market – June 2021
Diesel and LPG prices increasedIn the June quarter 2021, diesel and LPG prices in the 5 largest cities both increased:
� average retail diesel prices were 137.5 cpl in the quarter, an increase of 8.4 cpl (or around 7%) from the March quarter 2021 (129.1 cpl)
� average retail LPG prices were 90.9 cpl in the quarter, an increase of 5.3 cpl (or around 6%) from the March quarter 2021 (85.6 cpl).8
8 For petrol, the percentage change in the June quarter 2021 was an increase of around 6%.
14 Report on the Australian petroleum market – June 2021
1. Developments in the petroleum industry
1.1 Demand for petrol remained lower than pre-pandemic levels
The COVID-19 restrictions on travel and economic activity in Australia imposed in mid-March 2020 meant that there was significantly less petrol purchased from retail sites in the June quarter 2020. In the second half of 2020, petrol sales volumes partially recovered as restrictions in parts of Australia eased. Quarterly average petrol sales in 2020 (2,094 million litres) were 14% below quarterly average sales in 2019 (2,430 million litres).
Chart 1.1 shows that in the March quarter 2021, sales volumes declined marginally to 2,250 million litres, from 2,289 million litres in the December quarter 2020, and remained virtually the same in the June quarter 2021 (2,257 million litres).
Chart 1.1: Quarterly sales volumes of regular unleaded petrol in Australia: March quarter 2019 to June quarter 2021
1,500
1,700
1,900
2,100
2,300
2,500
2,700
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
Mill
ion
litre
s
Quarterly avg: 2019
Quarterly avg: 2020
Source: DISER, Australian Petroleum Statistics, issue 299, June 2021, at: https://www.energy.gov.au/publications/australian-petroleum-statistics-2021, accessed on 25 August 2021.
Quarterly sales in the June quarter 2021 were around 7% lower than quarterly average sales volumes in 2019 and around 8% higher than quarterly average sales volumes in 2020.
Chart 1.2 shows that annual sales volumes in Australia have been steadily declining over the past 10 years. Factors that have contributed to this decrease include more fuel efficient vehicles, and increasing sales of premium unleaded petrol (PULP) and diesel. However, there was a sharp decrease in 2019–20, when the impact of COVID-19 was first experienced, and sales volumes decreased further in 2020–21. Annual sales volumes in 2020–21 (8,814 million litres) were around 11% lower than they were in 2018–19.
15 Report on the Australian petroleum market – June 2021
Chart 1.2: Annual sales volumes of regular unleaded petrol in Australia: 2010–11 to 2020–21
8,000
8,500
9,000
9,500
10,000
10,500
11,000
11,500
12,000
2010
–11
2011
–12
2012
–13
2013
–14
2014
–15
2015
–16
2016
–17
2017
–18
2018
–19
2019
–20
2020
–21
Mill
ion
litre
s
Source: DISER, Australian Petroleum Statistics, issue 299, June 2021, at: https://www.energy.gov.au/publications/australian-petroleum-statistics-2021, accessed on 25 August 2021.
Note: 2010-11 is the earliest year with sales volumes data in the Australian Petroleum Statistics.
1.2 The Australian Government’s fuel security package became law
The Fuel Security Act 2021, which gives effect to key measures in the Australian Government’s fuel security package, received assent on 29 June 2021.9
The fuel security package includes:
� a variable fuel security services payment to refineries, funded by the Australian Government, which recognises the fuel security benefits that refineries provide to all Australians
� a minimum stockholding obligation to ensure industry holds minimum quantities of key transport fuels to guarantee a baseline level of stocks at all times
� support for major refinery infrastructure upgrades to help refiners bring forward to 2024 the production of better-quality fuels currently scheduled to take place by 2027.
Under the fuel security services payment, payments will be made to the participating refineries between the following ranges: 0 cents per litre when the margin marker reaches $10.20 per barrel (the collar) and a maximum of 1.8 cents per litre when the marker drops to $7.30 per barrel (the cap). The margin marker will be developed separately for each refinery. Payments to refineries for production of key transport fuels were scheduled to begin from 1 July 2021.
The variable fuel security services payment has been costed up to $2.047 billion to 2030 in a worst-case scenario. This figure assumes that both refineries are paid at the highest rate over the entire 9 years in COVID-19-like economic conditions, which is unlikely as the economy recovers. Actual payments are expected to be less than this, as payments are linked to refining margins at the time and to actual production of key transport fuels.
9 Parliament of Australia, Fuel Security Bill 2021, at: https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r6716, accessed on 25 August 2021.
16 Report on the Australian petroleum market – June 2021
The minimum stockholding obligation will commence in July 2022 to safeguard key transport fuel stocks at a baseline level, with a 40% increase in diesel stockholdings from mid-2024.
Many of the specific details of how the fuel security services payment and the minimum stock holding obligation will work are yet to be developed, and will be included in Rules determined by the Minister.10
1.3 Ampol announced that it would continue refining operations at Lytton and participate in the fuel security package
On 17 May 2021, Ampol announced it had completed its refinery review and intended to continue refining operations at Lytton in Brisbane.11 This decision was subject to the government’s refining support package being successfully legislated as proposed. Under the package, Ampol is required to commit to ongoing refinery operations at Lytton until at least 2027.
Ampol noted that the package would help underpin the viability of the refinery over the medium term, providing a variable support payment of up to $108 million per annum. Ampol retained the option to pursue conversion to an import terminal in future, in the case of persistently low refinery margins or other adverse events, including potential changes to the fuel security services payment by future governments.
Ampol noted that the Australian Government would provide a grant of up to $125 million to the Lytton refinery, to undertake infrastructure upgrades to produce ultra-low sulphur petrol in accordance with fuel quality standard changes by the end of 2024. Ampol expects this support will cover approximately half of the required investment at Lytton to produce ultra-low sulphur petrol.12
In the first half of 2021 Ampol received $40 million through the government’s temporary refining production payment (replaced by the fuel security services payment from 1 July 2021).13
1.4 Viva Energy also announced that it would participate in the fuel security package
On 17 May 2021, Viva Energy announced that it expected to commit to and participate in the fuel security package, subject to the finalisation of the detail of the package, and legislative approval.14
In December 2020, the Australian Government announced that it would commence refinery production payments on 1 January 2021, and Viva Energy immediately announced that it would participate in the program.15 The fuel security services payment replaces the temporary refinery production payment received by Viva Energy. In the first half of 2021 Viva Energy received $40.6 million through the government’s temporary refining production payment.16
10 Parliament of Australia, Parliamentary Library, Fuel Security Bill 2021, Flag Post, 17 June 2021, at: https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/FlagPost/2021/June/Fuel_Security_Bill_2021, accessed on 25 August 2021.
11 Ampol, Ampol to continue refining operations at Lytton, media release, 17 May 2021, at: https://wcsecure.weblink.com.au/pdf/ALD/02375059.pdf, accessed on 25 August 2021.
12 Ampol, Proposed government refining support and decision to continue operation of Lytton, ASX Release, 17 May 2021, at: https://wcsecure.weblink.com.au/pdf/ALD/02375041.pdf, accessed on 25 August 2021.
13 Ampol, Financial results for half year ended 30 June 2021, ASX release, 23 August 2021, p. 2, at: https://www.ampol.com.au/-/media/files/ampol-au/about-ampol/investor-centre/2021/2021-half-year-asx-release.ashx, accessed on 25 August 2021.
14 Viva Energy, Federal Government Fuel Security Announcement, ASX release, 17 May 2021, at: https://investor.vivaenergy.com.au/DownloadFile.axd?file=/Report/ComNews/20210517/02375071.pdf, accessed on 25 August 2021.
15 The Hon Angus Taylor MP, Minister for Energy and Emissions Reduction, Immediate support for Australia’s refineries and fuel security, media release, 14 December 2020, at: https://www.minister.industry.gov.au/ministers/taylor/media-releases/immediate-support-australias-refineries-and-fuel-security, accessed on 25 August 2021; and Viva Energy Australia, Federal Government Interim Refinery Production Payment, ASX Release, 14 December 2020, at: https://investor.vivaenergy.com.au/DownloadFile.axd?file=/Report/ComNews/20201214/02321599.pdf, accessed on 25 August 2021.
16 Viva Energy, Results for Half Year ended 30 June 2021 and capital management, ASX release, 24 August 2021, p. 3, at: https://investor.vivaenergy.com.au/investor-centre/?page=asx-announcements, accessed on 25 August 2021.
17 Report on the Australian petroleum market – June 2021
As part of the fuel security package, Viva Energy would make a 6-year commitment to maintain operations at its Geelong refinery through to 30 June 2027, with a further 3-year option for Viva Energy to extend until 30 June 2030.
Viva Energy noted the Australian Government’s intention to bring forward the requirement for ultra-low sulphur gasoline to the end of 2024, and the provision of a 50% contribution (up to a maximum of $125 million) towards the capital upgrades necessary at Geelong. Viva Energy expects the capital upgrades to cost up to $250 million and is conducting assessment work to commence the project to deliver this by the end of 2024.
1.5 Informed Sources’ undertaking expiredInformed Sources’ 5-year undertaking to make fuel price information available to consumers ceased on 20 May 2021.
In August 2014, the ACCC took court action against Informed Sources and several petrol retailers that subscribed to its Oil Price Watch service.17 Informed Sources operates a petrol price information exchange service which allows for subscribing petrol retailers to exchange prices on a near real-time basis. The ACCC was concerned that this arrangement, which allowed for the highly frequent and private exchange of price information between petrol companies, had the effect or likely effect of substantially lessening competition for the retail sale of petrol.
In December 2015, the ACCC resolved these proceedings with undertakings from Informed Sources and the petrol retailers.18 The undertaking from Informed Sources stated that it would make the same fuel price information available to consumers as it does to its subscribers, and provide data to third party app providers on reasonable commercial terms. In May 2016, MotorMouth (a subsidiary of Informed Sources) updated its app to provide motorists with access to near real-time petrol prices for the first time. The undertakings took effect from 21 May 2016 and lasted for 5 years.
Around the same time as the resolution with Informed Sources and the petrol retailers, the New South Wales Government announced the introduction of a fuel price transparency scheme (FuelCheck) that commenced in August 2016.
The improvements to the MotorMouth app from May 2016, combined with the steady introduction of government fuel price transparency schemes in most of the states and territories, improved the functioning of retail petrol markets. More motorists can now easily use apps and websites to compare prices across retail sites and provide greater public scrutiny of the behaviour of petrol retailers.
Commercial apps such as the Motormouth app, as well as others, continue to be available for consumers in Victoria and the Australian Capital Territory, which do not have government-mandated fuel price transparency schemes.
1.6 Motorists use of fuel price apps has been increasingIn September 2020, the Tasmanian Government commenced its fuel price transparency scheme (FuelCheck TAS) and in December 2020, the RACT introduced its Fuel Saver website and app.19 On 28 June 2021, the Tasmanian Minister for Workplace Safety and Consumer Affairs noted that
17 ACCC, ACCC takes action against Informed Sources and petrol retailers for price information sharing, media release, 20 August 2014, at: https://www.accc.gov.au/media-release/accc-takes-action-against-informed-sources-and-petrol-retailers-for-price-information-sharing.
18 ACCC, Petrol price information sharing proceedings resolved, media release, 23 December 2015, at: https://www.accc.gov.au/media-release/petrol-price-information-sharing-proceedings-resolved.
19 Elise Archer, Tasmanian Minister for Building and Construction, Putting downward pressure on fuel prices in Tasmania, media release, 18 September 2020, at: http://www.premier.tas.gov.au/releases/putting_downward_pressure_on_fuel_prices_in_tasmania, accessed on 25 August 2021; and RACT, New RACT Fuel Saver app to help put more money in your pocket this Christmas, media release, 21 December 2020, at: https://www.ract.com.au/-/media/project/ract-group/ract/ract-website/community/news-and-media/media-releases/december-2020/ract-mr---fuel-saver-and-united-brighton---21-december-2020.pdf, accessed on 25 August 2021.
18 Report on the Australian petroleum market – June 2021
the combined downloads of the FuelCheck TAS app and the RACT’s Fuel Saver app had exceeded 53,000.20
On 20 March 2021, the South Australian Government’s fuel price transparency scheme commenced and, on the same day, the RAA introduced its myRAA app.21 On 4 April 2021, the South Australian Attorney-General noted that South Australians were reaping the benefits of the fuel price transparency scheme, with the latest figures showing that the myRAA app had been used more than 145,000 times since it launched.22
A media article in July 2021 noted increasing use of fuel price apps in Queensland in the first half of 2021.23 It stated that in December 2020, when the Queensland Government announced its 2-year real-time fuel-price-monitoring scheme was being made permanent, 20,000 people were using fuel price apps each day. By May 2021, this had increased to 25,000 people a day. The article noted that fuel price apps and websites were used 783,862 times in May 2021.
1.7 The Independent Pricing and Regulatory Tribunal released a draft report on ethanol in New South Wales
In April 2021, the New South Wales Independent Pricing and Regulatory Tribunal (IPART) released a draft report on its approach to setting wholesale ethanol prices, and the market conditions in the wholesale and retail markets for ethanol.24
The report made the following key conclusions:
� Sales of fuel ethanol in New South Wales averaged around 2.1% of total petrol sales in 2020–21.
– This remains below the 6% required if all fuel retailers were to meet the mandate on average across New South Wales.
� The price of E10 was on average 2.2 cpl lower than the price of RULP in 2020.
� Relatively low oil and petrol prices have maintained downward pressure on ethanol prices, since E10 prices must be competitive with prices of RULP.
� Consumers continue to have an effective choice of fuel with widespread availability of E10, RULP and PULP
– 87% of retail sites sell E10, and 76% sell RULP
– 58% of retail sites sell both E10 and RULP.
� The wholesale price of E10 has exceeded the wholesale price of RULP since March 2020.
� The implied wholesale price of ethanol remained significantly below IPART’s determined price in 2020.
� Low fuel prices over 2020 have reduced the profitability of ethanol suppliers. United closed its Dalby bio-refinery in June 2020. There are now only 2 ethanol producers on the East Coast of Australia, down from 3. It is unlikely that new suppliers will enter the wholesale market in the short term.
20 Elise Archer, Tasmanian Minister for Workplace Safety and Consumer Affairs, App-savvy motorists put pressure on fuel prices, media release, 28 June 2021, at: http://www.premier.tas.gov.au/site_resources_2015/additional_releases/app-savvy_motorists_put_pressure_on_fuel_prices, accessed on 25 August 2021.
21 Vickie Chapman MP, South Australian Attorney General, Fuel up! Real-time petrol pricing is here, media release, 20 March 2021, at: https://www.premier.sa.gov.au/news/media-releases/news/fuel-up!-real-time-petrol-pricing-is-here, accessed on 25 August 2021; and RAA SA, RAA urges drivers to cash in as real-time fuel pricing app launched, media release, 20 March 2021, at: https://our.raa.com.au/about-raa/media-releases/1457, accessed on 25 August 2021.
22 Vickie Chapman MP, South Australian Attorney General, Hop on an app and hunt for a bargain this Easter, media release, 4 April 2021, at: https://www.premier.sa.gov.au/news/media-releases/news/hop-on-an-app-and-hunt-for-a-bargain-this-easter, accessed on 25 August 2021.
23 Domanii Cameron, ‘Brisbane petrol price surge drives motorists to price tracking apps’, Courier Mail, 8 July 2021.
24 Independent Pricing and Regulatory Tribunal, Approach to determining wholesale ethanol prices, April 2021, at: https://www.ipart.nsw.gov.au/sites/default/files/cm9_documents/Draft-Report-Approach-to-determining-wholesale-ethanol-prices-April-2021.PDF, accessed on 25 August 2021.
19 Report on the Australian petroleum market – June 2021
With respect to IPART’s approach to setting wholesale ethanol prices, the report concluded:
� IPART will continue to determine wholesale ethanol prices based on the price of importing ethanol from overseas (the “import parity price”).
� IPART will continue to include excise rates for imported fuel in its import parity price calculation.
� Additional price constraints are not required because low retail fuel prices are continuing to protect consumers from excessive wholesale ethanol prices.
1.8 The transition from Caltex to Ampol sites continued In December 2019, Caltex Australia announced that it would transition its name to Ampol over 3 years, beginning in 2020.25 This involves transitioning its full retail network to use the ‘Ampol’ brand. By the end of 2020, Caltex had rebranded 26 Ampol sites.26
On 9 June 2021, Ampol noted that it continues the roll out of the Ampol brand across its network and, with over 250 sites already transitioned, was on track to complete the program by the end of 2022.27 On 23 August 2021, Ampol reported that as at 30 June 2021, 389 sites had been rebranded.28
25 Caltex Australia, Ampol is back! Iconic Australian fuel brand to return in 2020, media release, 23 December 2019, at: https://www.ampol.com.au/about-ampol/news-and-media/ampol-is-back-in-2020, accessed on 25 August 2021.
26 Ampol, Annual Report 2020, at: https://www.ampol.com.au/about-ampol/investor-centre/annual-reports, accessed on 25 August 2021.
27 Ampol, Chevron Federal Court proceedings update, ASX release, 9 June 2021, at: https://wcsecure.weblink.com.au/clients/ampol/headline.aspx?headlineid=21302718, accessed on 25 August 2021.
28 Ampol, Financial results for half year ended 30 June 2021, ASX release, 23 August 2021, p.2.
20 Report on the Australian petroleum market – June 2021
2. ACCC activities
2.1 ACCC and the petrol industryThe main role of the ACCC is to enforce the Competition and Consumer Act 2010 (the Act) across the Australian economy, including the fuel industry. The ACCC’s activities under the Act include enforcement and compliance, mergers and acquisitions assessments, authorisations and notifications, and administration of the Oil Code.29
Market forces determine wholesale and retail petrol prices in Australia. The ACCC does not set prices in petrol markets and does not have the powers to do so. In the absence of anticompetitive conduct that is in breach of the Act (such as price fixing with competitors), high petrol prices are not illegal.
The ACCC’s petrol monitoring role is to assist consumers to navigate this complex industry. Through its petrol monitoring reports, industry reports and other information channels, the ACCC promotes transparency in the Australian petroleum industry and improved public awareness of the factors that determine retail petrol prices. ACCC monitoring can also shine a light on and place pressure on less competitive pricing.
2.2 Activities in the June quarter 20212.2.1 7-Eleven applied to continue authorisation to continue trading
hours arrangements for an additional 6 months On 11 March 2021, 7-Eleven Stores Pty Limited (7-Eleven) sought authorisation to continue arrangements that were authorised by the ACCC in 2020.30
Authorisation provides statutory protection from court action for conduct that might otherwise raise concerns under the competition provisions of the Act. The ACCC may grant an authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.
Under the arrangements authorised in 2020, 7-Eleven may approach some of its franchisees, and if they agree, enter into arrangements with them to either temporarily close or reduce the trading hours of certain stores. This may include stores operated by franchisees, and stores operated by 7-Eleven. 7-Eleven advised that the purpose of the conduct is to assist 7-Eleven and its franchisees to respond to and endure the COVID-19 pandemic in a cost-efficient manner, while supporting 7-Eleven’s customers.
7-Eleven’s existing authorisation for the same conduct was due to expire on 31 March 2021. 7-Eleven sought authorisation to continue the arrangements for an additional 6 months.
7-Eleven also requested interim authorisation. On 25 March 2021, the ACCC granted interim authorisation, subject to conditions. The conditions require 7-Eleven to notify the ACCC of the franchisees it proposes to approach for temporary store closure or a reduction in hours, and the stores (both corporate owned and franchised) which will be closed or have reduced hours.
On 1 July 2021, the ACCC issued a draft determination proposing to grant re-authorisation for 6 months from the date of the final determination with the same conditions.
On 28 July 2021, the ACCC issued a final determination granting the re-authorisation with the same conditions as previously, until 30 June 2022. Given the ongoing uncertainty around the impact of the COVID-19 pandemic, the ACCC considered a longer authorisation period than that contemplated in the draft decision was appropriate.
29 The Oil Code is a prescribed mandatory industry code of conduct, the purpose of which is to regulate the conduct of suppliers, distributors and retailers in the downstream petroleum industry.
30 See: https://www.accc.gov.au/public-registers/authorisations-and-notifications-registers/authorisations-register/7-eleven-stores-pty-limited-0.
21 Report on the Australian petroleum market – June 2021
2.2.2 7-Eleven applied for authorisation to participate in Velocity’s loyalty program as a retail partner
On 24 March 2021, the ACCC received an application for authorisation from 7-Eleven on behalf of itself, its franchisees and Velocity Frequent Flyer Pty Ltd (Velocity).31
The Applicants sought authorisation for 7-Eleven to participate as a retail partner of Velocity’s loyalty program. The Applicants are also considering the potential appointment of 7-Eleven by Velocity as a redemption partner. Authorisation was sought for 5 years. The Applicants requested interim authorisation.
On 7 May 2021, the ACCC granted interim authorisation to allow 7-Eleven to commence participation in the Velocity loyalty program while the ACCC considered the merits of the substantive application for authorisation. On 11 June 2021, the ACCC issued a draft determination proposing to grant authorisation.
On 28 July 2021, the ACCC issued a final determination granting authorisation.
2.2.3 Stakeholder engagement and communications activityIn the June quarter 2021, the ACCC responded to fuel-related media enquiries on retail fuel prices, petrol price cycles, fuel price information and competition issues. Responses were prepared for general correspondence on fuel-related subjects including: retail fuel prices and price differentials between retail sites in larger cities, petrol price cycles, price competition in regional locations, and Australian retail fuel prices relative to international price movements.
In May each year the ACCC usually hosts a meeting of the Fuel Consultative Committee, which comprises representatives from major fuel retailers, refiner-wholesalers, peak industry associations and motoring organisations. However, as a result of the COVID-19 pandemic, this was cancelled.
In the June quarter 2021, the fuel-related pages on the ACCC website received 132,248 page views, a decrease of 14,398 page views (around 10%) from the previous quarter. Of this total, the petrol price cycles web page received 121,633 page views, a decrease of 9,989 (around 8%) from the previous quarter. This was the most viewed page on the ACCC website in the June quarter 2021.
In 2020–21, the fuel-related pages on the ACCC website received 523,910 page views, a decrease of 62,601 page views (around 11%) from 2019–20. Of this total, the petrol price cycles web page received 471,104 page views, a decrease of 62,436 page views (around 12%) from 2019–20. The petrol price cycle webpage was the most viewed page on the ACCC website in 2020–21, as it was in the previous 3 years.
The ACCC receives enquiries and complaints about fuel-related issues through the year, via the ACCC Infocentre, from members of the public, and referrals from other stakeholders. In 2020–21, the ACCC Infocentre received around 530 enquiries and complaints, which was around 60% lower than in 2019–20 (when it received around 1340 enquiries and complaints). A large number of enquiries and complaints from March to May 2020, when petrol prices decreased sharply during the early period of the pandemic, significantly influenced the higher 2019–20 total.
31 See: https://www.accc.gov.au/public-registers/authorisations-and-notifications-registers/authorisations-register/7-eleven-stores-pty-limited-and-velocity-frequent-flyer-pty-ltd.
22 Report on the Australian petroleum market – June 2021
2.3 Report on petrol prices by major retailer in 2019 and 2020
On 8 June 2021, the ACCC released its second industry report under the petrol monitoring Direction issued by the Treasurer in December 2019.32 The report analysed annual average retail petrol prices in 2019 and 2020 to identify the highest and lowest priced major retailers in the 8 Australian capital cities.
The report is available on the ACCC website and the key messages of the report were included in the ACCC’s March quarter 2021 report on the Australian petroleum market.33
32 ACCC, Independent chains generally have the lowest prices - report on petrol prices by major retailer in 2019 and 2020.
33 ACCC, Report on the Australian petroleum market - March quarter 2021, 6 July 2021, at: https://www.accc.gov.au/system/files/Quarterly%20report%20on%20the%20Australian%20petroleum%20market%20-%20March%20quarter%202021.pdf.
23 Report on the Australian petroleum market – June 2021
3. Retail petrol price movements in the 5 largest cities
This chapter focuses on petrol prices in the 5 largest cities (Sydney, Melbourne, Brisbane, Adelaide and Perth). Chapter 5 analyses petrol prices in the smaller capital cities (Canberra, Hobart and Darwin) and regional locations across Australia.
3.1 Retail prices in the 5 largest cities increased in the quarter
In the June quarter 2021, average retail petrol prices in the 5 largest cities were 142.0 cpl. This was an increase of 8.6 cpl from the March quarter 2021 (133.4 cpl). Prices increased in all cities.
Table 3.1 shows quarterly average retail prices in the June quarter 2021, the March quarter 2021 and the change in each of the 5 largest cities.
Table 3.1: Quarterly average retail petrol prices in each of the 5 largest cities: March quarter 2021 and June quarter 2021 – cpl
Quarter Sydney34 Melbourne Brisbane Adelaide Perth 5 largest cities
Mar-21 132.8 136.2 135.6 132.1 130.3 133.4
Jun-21 143.6 144.5 146.8 135.2 139.9 142.0
Change 10.8 8.3 11.2 3.1 9.6 8.6
Source: ACCC calculations based on FUELtrac data.
Table 3.1 shows that in the June quarter 2021:
� Brisbane’s average retail prices were the highest (146.8 cpl). Melbourne had the highest prices in the March quarter 2021.
� Adelaide’s average retail prices were the lowest (135.2 cpl). Perth had the lowest prices in the March quarter 2021.
� Prices increased the most in Brisbane (by 11.2 cpl) and the least in Adelaide (by 3.1 cpl).
3.2 Retail prices remained relatively stable over the quarter
Chart 3.1 shows that 7–day rolling average retail petrol prices in the 5 largest cities were relatively stable in the second half of 2020 before increasing in the March quarter 2021. This followed record low prices on 29 April 2020.35 The last time 7–day rolling average prices were at this level was on 9 January 2005 (92.2 cpl).36 In the 6 months between July and December 2020, 7–day rolling average retail petrol prices were within a 21.4 cpl band between 112.4 cpl and 133.8 cpl.
34 The prices in this table for Sydney are E10 prices. For comparison purposes, quarterly average RULP prices in Sydney were 145.1 cpl in the June quarter 2021 and 134.2 cpl in the March quarter 2021.
35 Charts in chapter 5 show 7–day rolling average retail petrol prices in each of the 5 largest cities over the 2 years to 30 June 2021.
36 In real terms, they were the lowest recorded since the ACCC’s predecessor, the Prices Surveillance Authority, began collecting comprehensive retail prices in all 5 cities in May 1991.
24 Report on the Australian petroleum market – June 2021
Chart 3.1: Seven-day rolling average retail petrol prices in the 5 largest cities: 1 July 2019 to 30 June 2021
80
90
100
110
120
130
140
150
160
170Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Source: ACCC calculations based on data from FUELtrac.
Notes: The area to the right of the dotted vertical line in this and subsequent charts represents the June quarter 2021.
A 7–day rolling average price is the average of the current day’s price and prices on the 6 previous days. Traditionally, the ACCC has used a 7–day rolling average to smooth out the influence of petrol price cycles in the larger cities on price movements. This has been less effective in recent years because the duration of price cycles in most of the larger cities has become substantially greater than 7 days.
In the June quarter 2021, 7–day rolling average retail petrol prices were relatively stable following the upward trend in the March quarter 2021. Average prices were 141.6 cpl at the beginning of the quarter, and fluctuated within a 10.0 cpl band before reaching a high of 147.6 cpl at the end of the quarter. The last time 7–day rolling average retail petrol prices were at this level was on 18 February 2020.
3.3 Annual average prices in the 5 largest cities in 2020–21 were the lowest in 22 years in real terms
In 2020–21, annual average retail prices in the 5 largest cities were 129.7 cpl, a decrease of 4.9 cpl from 2019–20 (134.6 cpl). Annual average retail petrol prices decreased in each of the 5 largest cities.
Table 3.2 shows annual average retail prices in 2019–20 and 2020–21, and the change, in each of the 5 largest cities.
Table 3.2: Annual average retail petrol prices in each of the 5 largest cities: 2019–20 and 2020–21 – cpl
Year Sydney37 Melbourne Brisbane Adelaide Perth 5 largest cities
2019–20 132.8 135.8 136.8 135.8 131.8 134.6
2020–21 129.4 133.1 133.6 125.6 126.7 129.7
Change -3.4 -2.7 -3.2 -10.2 -5.1 -4.9
Source: ACCC calculations based on FUELtrac data.
Table 3.2 shows that in 2020–21:
� Brisbane’s average retail prices were the highest (133.6 cpl), as was the case in 2019–20.
� Adelaide’s average retail prices were the lowest (125.6 cpl). Perth had the lowest prices in 2019–20.
� Prices decreased the most in Adelaide (by 10.2 cpl) and the least in Melbourne (by 2.7 cpl).
37 The prices in this table for Sydney are E10 prices. For comparison purposes, annual average RULP prices in Sydney were 130.8 cpl in 2020–21 and 134.7 cpl in 2019–20.
25 Report on the Australian petroleum market – June 2021
Chart 3.2 shows that, in nominal terms, annual average prices in the 5 largest cities in 2020–21 were the lowest since 2016–17 (when annual average prices were 122.6 cpl). However, in real terms, annual average prices in 2020–21 were the lowest in 22 years (when annual average prices were 115.0 cpl in 1998–99).
Chart 3.2: Annual average retail petrol prices in the 5 largest cities in nominal and real terms: 1995-96 to 2020–21
60
70
80
90
100
110
120
130
140
150
160
170
180
1995
–96
1996
–97
1997
–98
1998
–99
1999
–00
2000
–01
2001
–02
2002
–03
2003
–04
2004
–05
2005
–06
2006
–07
2007
–08
2008
–09
2009
–10
2010
–11
2011
–12
2012
–13
2013
–14
2014
–15
2015
–16
2016
–17
2017
–18
2018
–19
2019
–20
2020
–21
cpl
Nominal prices Real prices
Source: ACCC calculations based on data from FUELtrac and Informed Sources, and Australian Bureau of Statistics, 6401.0 Consumer Price Index, Australia, June 2021, Tables 1 and 2. CPI: All Groups, Index Numbers and Percentage Changes, at: https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/jun-2021/640101.xls, accessed on 25 August 2021.
Note: Real prices are shown in 2020–21 dollars.
3.4 The number and nature of price cycles in each city varied
Price cycles (i.e. the sudden, sharp increases in the price of petrol, followed by a gradual decline) are a prominent and longstanding feature of retail petrol prices in Australia’s 5 largest cities. These price cycles do not occur in the smaller capital cities or in most regional locations. Price cycles are the result of pricing decisions made by petrol retailers aiming to maximise profits. They only occur at the retail level; wholesale prices do not exhibit similar cyclical movements.
Table 3.3 shows that in 2020–21 the number of price cycles varied in the 5 largest cities.
Table 3.3: Number of price cycles per quarter in the 5 largest cities: September quarter 2020 to June quarter 2021
Quarter Sydney Melbourne Brisbane Adelaide Perth
Sep–20 2 2 3 7 14
Dec–20 3 2 3 4 13
Mar–21 2 2 3 7 13
Jun–21 3 2 2 7 13
2020–21 10 8 11 25 53
Source: ACCC calculations based on data from FUELtrac.
Notes: A price cycle occurs in a quarter if the peak of a price cycle takes place in that quarter.
Perth had a price cycle once a week. There were 14 cycles recorded in the September quarter 2020.
26 Report on the Australian petroleum market – June 2021
In the June quarter 2021, Sydney had one more price cycle compared with the March quarter 2021 and Brisbane had one less. The number of price cycles remained unchanged in Melbourne, Adelaide and Perth.
In 2020 and the March quarter 2021, the average duration of price cycles in Sydney, Melbourne and Brisbane was around 5 to 6 weeks. Price cycles in Adelaide occurred more regularly, with an average duration of around 2 weeks. This continued in the June quarter 2021.
Perth had the most price cycles in 2020–21, with price cycles occurring on a weekly basis (as they have done since 2011). The WA FuelWatch scheme, which has been operating since 2001, may be influencing the consistency of price cycles in Perth.
The ACCC released a report on petrol price cycles in Australia in December 2018.38 The report noted that while motorists find price cycles frustrating, they could use price cycles to their advantage to make substantial savings across the year. The report analysed petrol price cycles between 2007 and 2017. The ACCC is extending the analysis to cover more recent years and intends to release another report later this year.
Chapter 4 shows that the impact of the COVID-19 situation on retail petrol prices has led to some changes in the price cycles in each city.
3.5 Retail prices in Brisbane were higher than the other 4 largest cities in aggregate
Retail prices in Brisbane are generally the highest among the 5 largest cities. In the June quarter 2021, Brisbane again had the highest prices, following 2 quarters in a row when Brisbane had the second highest prices after Melbourne.
Chart 3.3 shows quarterly average retail prices in Brisbane and average prices in the other 4 largest cities (Sydney, Melbourne, Adelaide and Perth) over the 2 years to the June quarter 2021. Over this period, Brisbane retail prices were on average 3.8 cpl higher than the average in the other 4 largest cities, ranging from a low of 1.5 cpl in the September quarter 2019 to a high of 6.0 cpl in the June quarter 2021.
Chart 3.3: Quarterly average retail prices in Brisbane and the other 4 largest cities in aggregate: September quarter 2019 to June quarter 2021
100
110
120
130
140
150
160
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
cpl
Brisbane Other 4 largest cities
Source: ACCC calculations based on data from FUELtrac.
38 ACCC, Petrol price cycles in Australia, 6 December 2018, at: https://www.accc.gov.au/publications/petrol-industry-reports/petrol-price-cycles-in-australia.
27 Report on the Australian petroleum market – June 2021
In the June quarter 2021, average retail prices in Brisbane (146.8 cpl) were 6.0 cpl higher than the other 4 largest cities in aggregate (140.8 cpl). This was 3.2 cpl higher than the differential in the March quarter 2021 (2.8 cpl).
In the year to June 2021, Brisbane retail prices were on average 4.9 cpl higher than the average across the other 4 largest cities. This was higher than the differential in the year to March 2021 (3.9 cpl).
The ACCC released its report on the Brisbane petrol market in October 2017.39 It noted that petrol prices in Brisbane had been significantly higher than those in the other 4 largest cities in the period 2009-10 to 2016-17. Over those 8 years, Brisbane motorists paid on average 3.3 cpl more for petrol than motorists in the other 4 largest cities.
The report found that the main factor influencing the higher prices in Brisbane was higher retail margins on petrol, which contributed to profits in Brisbane being significantly higher than the average across Australia. It also found that, compared with Sydney, retail pricing was less competitive in Brisbane, with retailers setting prices higher at the top and bottom of the price cycle than retailers in Sydney. Furthermore, Brisbane had fewer retail chains that were effective and vigorous price competitors. Brisbane had only 4 retailers in this category (7-Eleven, Woolworths, Puma Energy and United), while Sydney had 7 (Speedway, Metro, Budget, Westside, United, 7-Eleven and Woolworths).
The ACCC’s 2021 report on petrol prices by major retailer in 2019 and 2020 identified that motorists in Brisbane could make savings by shopping around. The report concluded that in 2020 if a motorist in Brisbane who bought petrol at the highest priced retailer (i.e. Coles Express) had instead bought it at the lowest priced retailer (i.e. United), they could have saved themselves on average 6.7 cpl each time they filled up, or $174.40
3.6 Retail petrol prices in Australia were lower than in most OECD countries due to lower taxes
Compared with other developed countries, Australia’s retail petrol prices are relatively low. Chart 3.4 shows average retail PULP 95 prices – both including and excluding taxes – among 31 countries in the Organisation for Economic Co-operation and Development (OECD) in the March quarter 2021 (the latest data available).
A degree of caution needs to be exercised when comparing international petrol prices, because fuel quality standards and taxation rates differ among countries, as does the availability and use of fuel types.
39 ACCC, Report on the Brisbane petrol market, 9 October 2017, at: https://www.accc.gov.au/publications/petrol-market-studies/report-on-the-brisbane-petrol-market.
40 ACCC, Independent chains generally have the lowest prices - report on petrol prices by major retailer in 2019 and 2020, p.5.
28 Report on the Australian petroleum market – June 2021
Chart 3.4: Average retail PULP 95 prices and taxes in OECD countries: Australian cpl, March quarter 2021
Australian cpl
Price less tax Tax component Average price less tax
0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150 160 170 180 190 200 210 220 230 240 250 260 270
United States
Turkey
Chile
Canada
Australia
Poland
Slovenia
Czech Republic
Hungary
Lithuania
Austria
Luxembourg
Latvia
Spain
Korea
Estonia
Slovak Republic
New Zealand
Belgium
Ireland
United Kingdom
Switzerland
Germany
France
Israel
Portugal
Norway
Greece
Denmark
Finland
Netherlands
Source: DISER, Australian Petroleum Statistics, issue 299, June 2021, at: https://www.energy.gov.au/publications/australian-petroleum-statistics-2021, accessed on 25 August 2021.
Note: All international prices shown are for PULP 95 RON, except for New Zealand (96 RON).
The chart shows that Australia had the fifth-lowest retail PULP 95 prices among OECD countries. However, the main reason for the lower retail petrol prices in Australia is the relatively low rate of taxation on fuel. In the March quarter 2021, taxes made up around 38% of the retail PULP 95 price in Australia. This was much lower than in many other OECD countries – the average tax component on PULP 95 prices in the OECD was around 58% in the March quarter 2021. Excluding taxes, PULP 95 prices in Australia were the equal fourth-highest among OECD countries.
Chart 3.5 shows average retail RULP prices – both including and excluding taxes – among 9 OECD countries in the March quarter 2021. In the majority of OECD countries, RULP is not sold in significant quantities. The chart shows that Australia had the fourth-lowest retail RULP prices among these countries. Excluding taxes, RULP prices in Australia were the third-highest among OECD countries.
29 Report on the Australian petroleum market – June 2021
Chart 3.5: Average retail RULP prices and taxes in OECD countries: Australian cpl, March quarter 2021
Australian cpl
Price less tax Tax component Average price less tax
0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150 160 170 180 190
Colombia
United States
Canada
Australia
Chile
Korea
Japan
Austria
New Zealand
Source: DISER, Australian Petroleum Statistics, issue 299, June 2021, at: https://www.energy.gov.au/publications/australian-petroleum-statistics-2021, accessed on 25 August 2021.
3.7 The price differential between premium and regular unleaded petrol remained high
Chart 3.6 shows that retail prices of the main grades of unleaded petrol – RULP, PULP 95, PULP 98, and E10 – all moved in a similar manner over the 2 years to June 2021.41
Chart 3.6: Monthly average retail prices of RULP, PULP 95, PULP 98 and E10 in the 5 largest cities: July 2019 to June 2021
RULP PULP 95 PULP 98 E10
85
95
105
115
125
135
145
155
165
175
185
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Source: ACCC calculations based on data from FUELtrac.
41 E10 prices are for Sydney and Brisbane only. RULP prices in Sydney are used in this section to calculate average RULP prices in the 5 largest cities.
30 Report on the Australian petroleum market – June 2021
In the June quarter 2021, the average differential in the 5 largest cities between:
� RULP and PULP 95 prices was 15.0 cpl (a decrease of 0.1 cpl from the previous quarter)
� RULP and PULP 98 prices was 23.0 cpl (an increase of 0.2 cpl)
� RULP and E10 was 2.1 cpl (an increase of 2.3 cpl).42
Retail prices of the main grades of petrol move in a similar manner because they are all influenced by international refined petrol benchmark prices (which, in turn, predominantly move in line with changes in the international price of crude oil).
The ACCC noted in its 2020 industry report on the financial performance of the downstream petroleum industry that PULP 95 and PULP 98 have become more expensive relative to the retail price of RULP over time, and that PULP was significantly more profitable than other petrol products.43
Between 2009–10 and 2019–20, the annual average price differential in real terms between RULP and PULP 95 increased from 11.3 cpl to 14.3 cpl, an increase of 3.0 cpl. The annual average price differential between RULP and PULP 98 similarly increased from 17.2 cpl to 22.5 cpl, an increase of 5.3 cpl.
A variety of factors can influence higher average prices for PULP, relative to RULP, including adjustments to specific international benchmarks and potentially changes in the quality of PULP products. However, the increases in PULP prices in recent years may be translating, at least in part, to higher profits on PULP.
42 Historically, E10 prices have generally been lower than RULP prices. In the March quarter 2021, average E10 prices were 0.2 cpl lower than average RULP prices.
43 ACCC, Financial performance of the Australian downstream petroleum industry 2002 to 2018, 22 April 2020, pp 3–4, at: https://www.accc.gov.au/publications/petrol-industry-reports/financial-performance-of-the-australian-downstream-petroleum-industry-2002-to-2018.
31 Report on the Australian petroleum market – June 2021
4. Components of petrol prices in the 5 largest cities
There are 3 broad components of average retail petrol prices:
� the international price of refined petrol (Mogas 95)
� taxes (excise and GST)
� other costs and margins, at the wholesale and retail levels.
This chapter analyses these components in the June quarter 2021 and 2020–21, and how they have changed over time.
4.1 Mogas 95 was the largest component of average petrol prices in the quarter
Chart 4.1 shows the components of average retail petrol prices in the 5 largest cities in the June quarter 2021.44
Chart 4.1: Components of average retail petrol prices in the 5 largest cities in the June quarter 2021
Other costs and marginsTaxesMogas 95
142.0 cpl
PETROL
62.8
39
17
55.6
23.6
cpl%
44
Source: ACCC calculations based on data from FUELtrac, Argus Media, RBA and ATO.
The chart shows that the price of Mogas 95 was the largest component of average petrol prices in the June quarter 2021 (44%). The 2 largest components – Mogas 95 and taxes – accounted for 83% of average petrol prices. These components are largely outside the control of the local petrol retailers.
In the June quarter 2021, as a proportion of average retail petrol prices:
� Mogas 95 increased by 3 percentage points from the March quarter 2021
� taxes decreased by 2 percentage points45
� other costs and margins decreased by 1 percentage point.
44 Taxes include fuel excise, and both the wholesale and retail components of GST.
45 On 1 February 2021, excise on petrol increased by 0.4 cpl to 42.7 cpl.
32 Report on the Australian petroleum market – June 2021
4.2 Taxes were the largest component of average petrol prices in 2020–21
Chart 4.2 shows the components of average retail petrol prices in the 5 largest cities in 2020–21.
Chart 4.2: Components of average retail petrol prices in the 5 largest cities in 2020–21
Other costs and marginsTaxesMogas 95
129.7 cpl
PETROL
50.2
42
19
54.3
25.2
cpl%
39
Source: ACCC calculations based on data from FUELtrac, Argus Media, RBA and ATO.
The chart shows that taxes were the largest component of average petrol prices in 2020–21 (42%). The 2 largest components – Mogas 95 and taxes – accounted for 81% of average petrol prices.
In 2020–21, as a proportion of average retail petrol prices:
� Mogas 95 decreased by 2 percentage points from 2019–20
� taxes increased by 2 percentage points
� other costs and margins were unchanged.
4.3 Changes in Mogas 95 prices continued to significantly influence changes in retail prices
As Australia’s local refining capacity cannot produce all of Australia’s fuel needs, refined petrol is imported to Australia from international markets. The price of refined petrol in the Asia-Pacific region is the relevant international benchmark price for the wholesale price of petrol in Australia. For RULP, it is the price of Singapore Mogas 95 Unleaded (Mogas 95). This benchmark is used for pricing petrol in Australia due to Australia’s proximity to Singapore, which is one of the world’s most important trading and refining centres.
The price of Mogas 95 is linked to the price of crude oil as crude oil is the major input into the production of refined petrol. Crude oil is an internationally traded commodity and its price is determined by global demand and supply factors. When the world price of crude oil changes it generally flows through into the price of refined petrol and then into retail petrol prices in Australia. Chapter 6 provides more details on movements in international crude oil and Mogas 95 prices.
Chart 4.3 shows monthly average Mogas 95 prices in Australian cents per litre, and monthly average retail petrol prices in the 5 largest cities, in the 2 years to June 2021. It shows that Mogas 95 prices and retail petrol prices in the 5 largest cities moved in a similar pattern over the past 2 years. This indicates that changes in the international price of refined petrol generally drive changes in domestic retail prices.
33 Report on the Australian petroleum market – June 2021
Chart 4.3: Monthly average retail petrol prices in the 5 largest cities and Mogas 95 prices: July 2019 to June 2021
10
20
30
40
50
60
70
80
90
80
90
100
110
120
130
140
150
160Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
cpl
5 largest cities (LHS) Mogas 95 (RHS)
Source: ACCC calculations based on data from FUELtrac, OPIS, Argus Media and RBA.
In the June quarter 2021:
� monthly average Mogas 95 prices increased from 59.9 cpl in March 2021 to 66.1 cpl in June 2021 (an increase of 6.2 cpl), and monthly average retail prices in the 5 largest cities increased from 140.6 cpl in March 2021, to 142.3 cpl in June 2021 (an increase of 1.7 cpl)
� quarterly average Mogas 95 prices were 62.8 cpl, an increase of 8.0 cpl from the March quarter 2021, and quarterly average retail petrol prices in the 5 largest cities were 142.0 cpl, an increase of 8.6 cpl.
In 2020–21:
� monthly average Mogas 95 varied by 25.7 cpl (from a low of 40.4 cpl in November 2020 to a high of 66.1 cpl in June 2021)
� monthly average retail prices in the 5 largest cities varied by 23.2 cpl (from a low of 119.1 cpl in November 2020 to a high of 142.3 cpl in June 2021).
4.4 The AUD–USD exchange rate remained relatively stable in the quarter
The AUD–USD exchange rate has a significant influence on Australia’s retail petrol prices, because international refined petrol is bought and sold in US dollars in global markets.
Chart 4.4 shows that the daily AUD–USD exchange rate varied significantly over the 2 years to 30 June 2021. It ranged from a low of US 56 cents in late March 2020 to a high of US 80 cents in late February 2021 (which was the highest level since January 2018).
34 Report on the Australian petroleum market – June 2021
Chart 4.4: Daily AUD–USD exchange rates: 1 July 2019 to 30 June 2021
50
55
60
65
70
75
80
85Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
US
cen
ts
Source: RBA.
Note: Exchange rates are the daily RBA 4.00 pm closing rates. See: http://www.rba.gov.au/statistics/frequency/exchange-rates.html.
In the June quarter 2021, the AUD–USD exchange rate remained relatively stable in a US 3.6 cents band, at an average of around US 77 cents. The quarterly average AUD-USD exchange rate was marginally lower (by US 0.3 cents) than the March quarter 2021.
Appreciation of the AUD against the USD puts downward pressure on domestic retail petrol prices, as refined petrol sold on international markets becomes relatively cheaper in AUD terms. If the AUD–USD exchange rate had been at the March 2020 low of US 56 cents in the June quarter 2021, average retail petrol prices in Australia would have been around 26.0 cpl higher (everything else being equal). This indicates the significant impact the AUD-USD exchange rate has on retail petrol prices.
The annual average AUD–USD exchange rate in 2020–21 was US 75 cents, which was around US 8 cents higher than in 2019–20 (US 67 cents), and was the highest annual average AUD–USD exchange rate since 2017–18 (US 78 cents).
4.5 Gross indicative retail differences were lower after record highs in 2020
Gross indicative retail differences (GIRDs) are a broad indicator of gross retail margins. The ACCC calculates GIRDs by subtracting average TGPs from average retail petrol prices. TGPs are prices that wholesalers charge for petrol in the spot market. The major wholesalers post these prices on their websites on a regular basis. Although few wholesale transactions occur at TGPs, they are indicative wholesale prices. TGPs, which vary across brands and cities, reflect the wholesale price of petrol only, and exclude other retail operating costs (such as freight, the cost of using a particular brand, and other costs of doing business including rent, wages and utility costs).
GIRDs are a broad indicator of gross retail margins, and should not be confused with actual retail profits which are more closely related to net margins.
The GIRDs reported by the ACCC are averages across the 5 largest cities over time. The level of prices, costs and profits vary significantly between retail operations and not all retail petrol sites will be achieving these gross margins. Some will be achieving higher gross margins, others lower. The ACCC petrol market studies published between 2015 and 2017 found that profits per retail petrol site could vary considerably between retailers, with some retail sites making substantial profits and others making very little.
35 Report on the Australian petroleum market – June 2021
Average GIRDs in the 5 largest cities were 14.8 cpl in the June quarter 2021, a decrease of 1.0 cpl from the previous quarter (see table 4.1). This was the third consecutive quarter in which GIRDs decreased. Average GIRDs decreased in Melbourne, Adelaide and Perth and increased in Sydney and Brisbane.
Table 4.1: Quarterly average retail petrol prices, TGPs and GIRDs in the 5 largest cities: September quarter 2020 to June quarter 2021 – cpl
Location Quarter Retail prices cpl
TGPs cpl
GIRDs cpl
5 largest cities Sep–20 122.1 103.4 18.7
Dec–20 121.4 104.0 17.4
Mar–21 133.4 117.6 15.8
Jun–21 142.0 127.2 14.8
2020–21 129.7 113.0 16.7
Sydney Sep–20 119.0 104.6 14.4
Dec–20 122.4 105.2 17.2
Mar–21 132.8 118.2 14.6
Jun–21 143.6 127.2 16.4
2020–21 129.4 113.7 15.7
Melbourne Sep–20 125.6 103.0 22.6
Dec–20 126.3 103.6 22.7
Mar–21 136.2 117.1 19.1
Jun–21 144.5 126.9 17.6
2020–21 133.1 112.6 20.5
Brisbane Sep–20 126.1 103.4 22.7
Dec–20 126.0 104.1 21.9
Mar–21 135.6 117.4 18.2
Jun–21 146.8 127.1 19.7
2020–21 133.6 112.9 20.7
Adelaide Sep–20 121.1 103.3 17.8
Dec–20 114.1 103.9 10.2
Mar–21 132.1 117.5 14.6
Jun–21 135.2 127.3 7.9
2020–21 125.6 112.9 12.7
Perth Sep–20 118.9 102.8 16.1
Dec–20 117.8 103.3 14.5
Mar–21 130.3 117.7 12.6
Jun–21 139.9 127.5 12.4
2020–21 126.7 112.7 14.0
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil, Viva Energy and WA FuelWatch.
Note: Retail prices, TGPs and GIRDs in Sydney are for E10.
36 Report on the Australian petroleum market – June 2021
Table 4.1 shows that in the 5 largest cities over the year to June 2021, quarterly average GIRDs:
� varied significantly over time and across cities, ranging from a high of 22.7 cpl (in Brisbane in the September quarter 2020 and Melbourne in the December quarter 2020) to a low of 7.9 cpl (in Adelaide in the June quarter 2021)
� were lowest in Sydney in the September quarter 2020, Melbourne, Adelaide and Perth in the June quarter 2021 and Brisbane in the March quarter 2021
� were highest in Sydney and Melbourne in the December quarter 2020, and highest in Brisbane, Adelaide and Perth in the September quarter 2020.
Chart 4.5 shows quarterly average GIRDs in the 5 largest cities over the past 3 years from the September quarter 2018 to the June quarter 2021.
Chart 4.5: Quarterly average GIRDs in the 5 largest cities: September quarter 2018 to June quarter 2021
8
10
12
14
16
18
20
Sep
–18
Dec
–18
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
cpl
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil, Viva Energy and WA FuelWatch.
The chart shows that average GIRDs in the 5 largest cities decreased in the 3 quarters following the record high GIRDs in the September quarter 2020 (18.7 cpl). Viva Energy noted in its 2021 Half Year Results Presentation in August 2021 that increases in oil prices influenced lower retail fuel margins in the first half of 2021.46 Despite the decreases in GIRDs in the past 3 quarters, they remain relatively high compared with previous levels.
The chart also shows that GIRDs can be volatile on a quarterly basis. When TGPs increase by large amounts in a short period, lags between changes in TGPs and changes in retail prices often have the effect of reducing GIRDs in the short term. Conversely, when TGPs decrease by large amounts in a short period these lags often have the effect of increasing GIRDs.
4.6 Annual average GIRDs in 2020–21 were the highest on record
Annual average GIRDs in the 5 largest cities in 2020–21 were 16.7 cpl, which was 2.0 cpl higher than the average GIRDs in 2019–20 (14.7 cpl). Annual average GIRDs were the highest in Brisbane (20.7 cpl) and the lowest in Adelaide (12.7 cpl).
In real terms, annual average GIRDs in the 5 largest cities increased by 1.8 cpl in 2020–21 to the highest annual average GIRD on record, as shown in chart 4.6.
46 Viva Energy, 2021 Half Year Results Presentation, 24 August 2021, p. 14, at: https://investor.vivaenergy.com.au/investor-centre/?page=asx-announcements, accessed on 25 August 2021.
37 Report on the Australian petroleum market – June 2021
Chart 4.6: Annual average GIRDs in the 5 largest cities in real terms: 2002–03 to 2020–21
0
2
4
6
8
10
12
14
16
18
2002
–03
2003
–04
2004
–05
2005
–06
2006
–07
2007
–08
2008
–09
2009
–10
2010
–11
2011
–12
2012
–13
2013
–14
2014
–15
2015
–16
2016
–17
2017
–18
2018
–19
2019
–20
2020
–21
cpl
Real GIRDs Period average (real terms)
Period avg: 9.5 cpl
Source: ACCC calculations based on data from FUELtrac, Informed Sources, Ampol, bp, Mobil, Viva Energy and WA FuelWatch, and Australian Bureau of Statistics, 6401.0 Consumer Price Index, Australia, December 2020, Tables 1 and 2. CPI: All Groups, Index Numbers and Percentage Changes, at: https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/latest-release#data-download, accessed on 25 August 2021.
Note: Real values are shown in 2020–21 dollars.
In 2020–21, annual average GIRDs in all capital cities except Adelaide increased to their highest level in real terms since the ACCC began monitoring them in 2002. In Adelaide, real annual average GIRDs decreased in 2020–21 from 15.8 cpl in 2019–20 to 12.7 cpl in 2020–21.
The ACCC analysed financial data provided by petrol companies on retail gross profits (i.e. retail operating costs and net profits) from 2005–06 to 2017–18 to further understand the reasons for the higher GIRDs over time.47 The analysis found that both retail operating costs and net profits on RULP increased during the period, and particularly between 2013–14 and 2016–17. This suggests that increases in both operating costs and profits influenced higher GIRDs.48
4.6.1 Lower turnover of petrol influenced the high GIRDs in 2020–21The effects of COVID-19 on petrol demand contributed to the high GIRDs in 2020–21.
Petrol sales volumes have been significantly affected since early 2020 and retailers may have been keeping retail prices higher to cover their fixed costs
Petrol retailing is a high-volume low-margin business with many fixed costs (such as rent and the cost of using a particular brand). This means that when sales volumes decline, the cost per unit of petrol will increase. To generate revenue to partially cover their fixed costs, some retailers may have been setting retail prices higher than they otherwise would.
As discussed in Chapter 1, national demand for petrol in the June quarter 2021 remained lower than pre-pandemic levels, and was similar to the March quarter 2021. Therefore, despite the recovery in sales volumes in many jurisdictions in the second half of 2020, it is likely that lower sales volumes continued to have a financial impact on some retailers in the June quarter 2021.
On an annual basis, sales volumes were particularly low in 2020–21, and were around 11% lower than in 2018–19, before the impact of COVID-19.
47 ACCC, Financial performance of the Australian downstream petroleum industry 2002 to 2018, 22 April 2020, pp. 34–36.
48 The analysis compared GIRDs (which are based on price data) with retail gross profit financial results on RULP (which are based on financial data). Both measures, although not directly comparable, showed a broadly similar upward trend over the longer term.
38 Report on the Australian petroleum market – June 2021
Some vertically-integrated participants reported losses at the refining level and stronger retail fuel margins in 2020
The substantial decrease in petrol demand from March 2020 has had negative implications for refineries throughout the world. Australian refineries experienced temporary shutdowns and reported losses in 2020. For example, in February 2021:
� Ampol announced losses of $145.0 million at its Lytton refinery in 2020 (compared with profits of $70 million in 2019)49
� Viva Energy announced losses of $95.1 million at its Geelong refinery in 2020 (compared with profits of $117.0 million in 2019).50
In February 2021, ExxonMobil announced that it no longer considered its Altona refinery to be economically viable and that it would convert it to an import terminal. This news followed bp’s announcement in October 2020 that it would cease fuel production at its Kwinana refinery in Western Australia and convert it to an import terminal.
In February 2021, when reporting on their financial results in 2020, both Viva Energy and Ampol noted higher retail margins in 2020:
� Viva Energy stated that ‘improvement in retail fuel margins over 2020 more than offset the decline in retail sales volumes’.51
� Ampol stated that ‘retail fuel earnings were supported by higher margins, including the benefits from oil price timing lags, offsetting volume weakness’.52
In August 2021, when reporting on financial results in the first half of 2021, Ampol commented that since the end of the first half of 2021, COVID-19 lockdowns have impacted on fuel demand and shop performance and there are signs that retail margins are providing a partial offset to the volume weakness.53
4.6.2 Petrol price cycles changed following the impact of COVID-19The higher GIRDs in the 5 largest cities following the impact of COVID-19 in early 2020 were reflected in changes in petrol price cycles.54
Charts 4.7 to 4.11 illustrate the shape of the price cycles. The charts show daily average retail petrol prices, TGPs and GIRDs in Perth, Melbourne, Brisbane, Sydney and Adelaide respectively for the period from 1 July 2019 to 30 June 2021.
Changes in the shape of the price cycles were different across the cities.
� While regular weekly price cycles continued in Perth throughout 2020, chart 4.7 shows that the average GIRD at the peak of the price cycle increased following the impact of COVID-19. This trend continued in the June quarter 2021.
� Charts 4.8 and 4.9 show the shape of the price cycles in Melbourne and Brisbane respectively. Following the impact of COVID-19, average retail prices in both cities took longer to reach the trough price of the price cycle. When they did, there was a larger difference between the trough price and average TGPs. This trend was broadly similar in the June quarter 2021.
49 Ampol, Financial results for full year ended 31 December 2020, ASX release, 22 February 2021, p.1, at: https://www.ampol.com.au/about-ampol/investor-centre/asx-announcements, accessed on 25 August 2021. In April 2021, Ampol stated that Lytton EBIT was breakeven in 1Q 2021. See Unaudited financial results for 1Q 2021, ASX release, 15 April 2021, at: https://www.ampol.com.au/about-ampol/investor-centre/asx-announcements, accessed on 25 August 2021.
50 Viva Energy Australia, Viva Energy Results: Financial Year ended 31 December 2020, ASX release, 24 February 2021, p.1, at: https://investor.vivaenergy.com.au/investor-centre/?page=asx-announcements, accessed on 25 August 2021.
51 Viva Energy, Viva Energy Results: Financial Year ended 31 December 2020, p.3.
52 Ampol, Financial results for full year ended 31 December 2020, p.2.
53 Ampol, Financial results for half year ended 30 June 2021, p.3.
54 Petrol price cycles in the 5 largest cities are not static and change over time. The ACCC’s 2018 petrol price cycles report analysed changes in price cycles between 2007 and 2017.
39 Report on the Australian petroleum market – June 2021
� Charts 4.10 shows that average retail prices in Sydney took longer to reach the trough price following the impact of COVID-19. When they did, there was a larger difference between the trough price and average TGPs. This difference increased in the June quarter 2021.
� Chart 4.11 shows a different trend for Adelaide. Although there were occasions when the price cycle did not get as close to TGPs as it had previously at the trough price, prices generally decreased to being either very close to, or below, TGPs in the second half of 2020. This continued in the June quarter 2021. There were also several price cycles where the peak price was relatively lower.
– The introduction of the fuel price transparency scheme in Adelaide from 20 March 2021 may have influenced the smaller cycles in April 2021.
Chart 4.7: Daily average retail petrol prices, TGPs and GIRDs in Perth: 1 July 2019 to 30 June 2021
GIRDsRetail prices TGPs
-10
10
30
50
70
90
110
130
150
170
190
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil, Viva Energy and WA FuelWatch.
Chart 4.8: Daily average retail petrol prices, TGPs and GIRDs in Melbourne: 1 July 2019 to 30 June 2021
GIRDsRetail prices TGPs
-10
10
30
50
70
90
110
130
150
170
190
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil and Viva Energy.
40 Report on the Australian petroleum market – June 2021
Chart 4.9: Daily average retail petrol prices, TGPs and GIRDs in Brisbane: 1 July 2019 to 30 June 2021
GIRDsRetail prices TGPs
-10
10
30
50
70
90
110
130
150
170
190Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil and Viva Energy.
Chart 4.10: Daily average retail petrol prices, TGPs and GIRDs in Sydney: 1 July 2019 to 30 June 2021
GIRDsRetail prices TGPs
–10
10
30
50
70
90
110
130
150
170
190
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil and Viva Energy.
41 Report on the Australian petroleum market – June 2021
Chart 4.11: Daily average retail petrol prices, TGPs and GIRDs in Adelaide: 1 July 2019 to 30 June 2021
GIRDsRetail prices TGPs
-10
10
30
50
70
90
110
130
150
170
190Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil and Viva Energy.
Table 4.2 shows for 2019–20 and 2020–21, and the June quarter 2021, the average GIRD on days when prices were at the top of the price cycle (peak days), and the average GIRD on days when prices were at the bottom of the price cycle (trough days), in each of the 5 largest cities.
Table 4.2: Average GIRDs in the 5 largest cities on peak and trough days of the price cycle: 2019–20 and 2020–21 and June quarter 2021 – cpl
Peak days Trough days
2019–20 2020–21 Jun–21 2019–20 2020–21 Jun–21
Sydney 27.8 31.2 31.1 0.1 2.6 4.7
Melbourne 30.8 38.6 36.3 3.2 7.5 6.1
Brisbane 35.6 39.7 38.0 2.9 6.2 6.2
Adelaide 33.5 30.1 22.3 0.8 -0.4 -0.7
Perth 22.6 31.7 31.5 1.9 0.6 0.3
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil, Viva Energy and WA FuelWatch.
Notes: Average GIRDs in Sydney are for E10.
A negative average GIRD means that the average retail price is below the average TGP.
The table shows that, compared with 2019–20, prices in 2020–21 increased further above TGPs at the peak of the price cycles, and did not decrease as close to TGPs at the troughs of the price cycles for all cities apart from Adelaide and Perth. In the June quarter 2021, average GIRDs on peak days in Adelaide were noticeably lower than in previous periods.
4.7 The increase in Mogas 95 prices was the main contributor to higher retail prices in the quarter
Chart 4.12 shows the change in the components of average retail petrol prices in the 5 largest cities between the March quarter 2021 and June quarter 2021. The chart separates the other costs and margins component into:
� the retail component (represented by GIRDs)
� the other wholesale costs and margins component (which includes international shipping costs and import costs).
42 Report on the Australian petroleum market – June 2021
Chart 4.12: Changes in the components of average retail petrol prices in the 5 largest cities: March quarter 2021 to June quarter 2021
Mogas 95 Other wholesale costs and margins Taxes GIRDs
54.8 62.8
9.510.1
53.354.3
15.814.8
0
20
40
60
80
100
120
140
160
Mar–21 Mogas 95 Exchange rate Other wholesalecosts and margins
Taxes GIRDs Jun–21
cpl +8.0 cpl
+8.6 cpl142.0 cpl
+1.0 cpl -1.0 cpl133.4 cpl
+0.6 cpl
+0.3 cpl+7.7 cpl
Source: ACCC calculations based on data from FUELtrac, Argus Media, Ampol, bp, Mobil, Viva Energy, WA FuelWatch, RBA and ATO.
Notes: All prices are in Australian cents per litre.
The taxes component includes fuel excise and wholesale GST. The small amount of retail GST is included in GIRDs rather than in taxes, to be consistent with GIRDs reported elsewhere in this report. As a result, the taxes component in this chart is not the same as the taxes component in chart 4.1.
The chart shows that the increase in average retail petrol prices in the 5 largest cities in the June quarter 2021 (8.6 cpl) was largely a result of the increase in the price of Mogas 95 (8.0 cpl).
The AUD–USD exchange rate is a significant determinant of Australia’s retail petrol prices because international refined petrol is bought and sold in US dollars in global markets. Excluding the effect of changes in the AUD–USD exchange rate (which was marginally lower in the quarter), Mogas 95 prices would have increased by 7.7 cpl in the quarter. The small decrease in the AUD–USD exchange rate compounded the increase in Mogas 95 prices and resulted in Mogas 95 prices increasing by an additional 0.3 cpl in AUD terms.
4.8 The higher AUD-USD exchange rate was the main contributor to lower annual average retail prices in 2020–21
Chart 4.13 shows the change in the components of annual average retail petrol prices in the 5 largest cities between 2019–20 and 2020–21.
43 Report on the Australian petroleum market – June 2021
Chart 4.13: Changes in the components of average retail petrol prices in the 5 largest cities: 2019–20 to 2020–21
Mogas 95 Other wholesale costs and margins Taxes GIRDs
Other wholesalecosts and margins
55.2 50.2
11.810.0
52.952.8
14.716.7
0
20
40
60
80
100
120
140
160
2019–20 Mogas 95 Exchange rate Taxes GIRDs 2020–21
cpl
129.7 cpl+0.9 cpl
-5.0 cpl
+2.0 cpl-0.1 cpl-1.8 cpl-5.9 cpl
-4.9 cpl134.6 cpl
Source: ACCC calculations based on data from FUELtrac, OPIS, Argus Media, Ampol, bp, Mobil, Viva Energy, WA FuelWatch, RBA and ATO.
Notes: All prices are in Australian cents per litre.
The taxes component includes fuel excise and wholesale GST. The small amount of retail GST is included in GIRDs rather than in taxes, to be consistent with GIRDs reported elsewhere in this report. As a result, the taxes component in this chart is not the same as the taxes component in chart 4.2.
The chart shows that the decrease in annual average retail petrol prices in the 5 largest cities in 2020–21 (by 4.9 cpl) was primarily a result of a higher annual average AUD-USD exchange rate.
Appreciation of the AUD against the USD puts downward pressure on domestic retail petrol prices. Excluding the effect of changes in the AUD–USD exchange rate (which increased by US 8 cents in 2020–21), average Mogas 95 prices would have increased by 0.9 cpl in 2020–21. The significant increase in the AUD–USD exchange rate, however, more than off-set the increase in the price of Mogas 95. This resulted in a net decrease in Mogas 95 prices in Australian cents per litre terms by 5.0 cpl.
Although GIRDs increased by 2.0 cpl in 2020–21, this was almost fully offset by a decrease in other wholesale costs and margins (by 1.8 cpl) and a small decrease in taxes (by 0.1).
44 Report on the Australian petroleum market – June 2021
5. Retail petrol price movements in the smaller capital cities and in regional locations
This chapter analyses petrol prices in the 3 smaller capital cities (Canberra, Hobart and Darwin) and in regional locations. The ACCC monitors fuel prices in over 190 regional locations across Australia. Appendix A lists these locations.
5.1 Retail prices in Darwin remained below prices across the 5 largest cities
In the June quarter 2021, average retail prices increased in all 3 smaller capital cities: Darwin by 13.5 cpl, Hobart by 12.7 cpl and Canberra by 10.3 cpl.55 However, average retail prices in Darwin remained below prices across the 5 largest cities.
Table 5.1 shows quarterly average retail prices in the March and June quarters 2021 in each of the 3 smaller capital cities and across the 5 largest cities. The table shows the differential between quarterly average prices in each of the smaller capitals and the 5 largest cities. It also shows similar data for 2019–20 and 2020–21.
Table 5.1: Quarterly and annual average retail petrol prices in each of the smaller capital cities and the 5 largest cities: March and June quarters 2021 and 2019–20 and 2020–21 – cpl
Canberra Hobart Darwin 5 largest cities
Differential
Canberra Hobart Darwin
Mar–21 131.9 133.7 126.4 133.4 -1.5 0.3 -7.0
Jun–21 142.2 146.4 139.9 142.0 0.2 4.4 -2.1
Change 10.3 12.7 13.5 8.6 1.7 4.1 4.9
2019–20 138.8 147.8 133.8 134.6 4.2 13.2 -0.8
2020–21 129.7 132.1 125.1 129.7 0.0 2.4 -4.6
Change -9.1 -15.7 -8.7 -4.9 -4.2 -10.8 -3.8
Source: ACCC calculations based on FUELtrac data.
Table 5.1 shows that between 2019–20 and 2020–21 annual average prices in each of the 3 smaller capital cities decreased by more than average prices in the 5 largest cities. In 2020–21, average prices in Darwin were again below average prices in the 5 capital cities as they were in the previous year. Average prices in Canberra were equal to the 5 capital cities in 2020–21. Hobart’s annual average prices were 2.4 cpl higher than in the 5 largest cities. However this was significantly lower than the differential in 2019–20 (13.2 cpl).
Chart 5.1 shows monthly average prices in each of the smaller capital cities and the 5 largest cities in the 2 years to June 2021.
55 Charts in section 5.5 show 7–day rolling average retail petrol prices in each of the 3 smaller capital cities over the 2 years to 30 June 2021.
45 Report on the Australian petroleum market – June 2021
Chart 5.1: Monthly average retail petrol prices in Canberra, Hobart, Darwin and the 5 largest cities: July 2019 to June 2021
90
100
110
120
130
140
150
160
170Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Canberra Hobart Darwin 5 largest cities
Source: ACCC calculations based on data from FUELtrac.
The chart shows that in 2020–21, monthly average retail prices were:
� lower in Darwin than in the 5 largest cities in all months
� higher in Hobart than in the 5 largest cities in all months except in January 2021
� lower in Canberra than in the 5 largest cities in July 2020 and in the 6 months from December 2020 to May 2021.
5.2 Average regional prices were again lower than prices in the 5 largest cities
In most parts of Australia retail petrol prices have historically been higher in regional locations than in the 5 largest cities. A number of factors may contribute to these higher prices, including:
� a lower level of local competition
� lower volumes of fuel sold
� distance/location factors
� lower convenience store sales.
The influence of these factors varies significantly from location to location. This means that there may be substantial differences in prices between specific regional locations.
Despite these factors, average prices in regional locations in aggregate (regional prices) were lower than average prices in the 5 largest capital cities in every quarter in 2020–21.
In the June quarter 2021, average regional prices were 141.0 cpl, which was 1.0 cpl lower than average prices in the 5 largest cities (142.0 cpl). In the March quarter 2021, average regional prices were 3.3 cpl lower than average prices in the 5 largest cities. This was the fourth quarter in a row when average regional prices were lower than average prices in the 5 largest cities.
Chart 5.2 shows that in 2020–21, monthly average regional prices were lower than prices in the 5 largest cities in all months except June 2021.
46 Report on the Australian petroleum market – June 2021
Chart 5.2: Monthly average retail petrol prices in regional locations in aggregate and the 5 largest cities: July 2019 to June 2021
90
100
110
120
130
140
150
160Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
All regional locations 5 largest cities
Source: ACCC calculations based on data from FUELtrac.
Regional prices increased over the June quarter 2021. In April 2021, monthly average regional prices were 139.6 cpl, an increase of 2.6 cpl from March 2021 (137.0 cpl). Monthly average prices increased to 140.9 cpl in May 2021 and increased again to 142.6 cpl in June 2021. Between March 2021 and June 2021, monthly average regional prices increased by 5.6 cpl, which was 3.9 cpl higher than the increase in the 5 largest cities over the same period (1.7 cpl).
In the June quarter 2021, average prices in 116 regional locations (representing around 63% of monitored locations) were lower than average prices in the 5 largest cities.
In 2020–21, annual average regional prices (127.6 cpl) were 2.1 cpl lower than average prices in the 5 largest cities (129.7 cpl). In comparison, in 2019–20 annual average regional prices were 4.0 cpl higher than average prices in the 5 largest cities, and in 2018–19 they were 6.5 cpl higher.
In 2020–21 average prices in 135 regional locations (around 74% of monitored locations) were lower than average prices in the 5 largest cities.
Appendix A has further information on petrol price movements in the June quarter 2021 and in 2020–21 in all locations the ACCC monitors.
5.3 Relatively lower regional prices may reflect more stable petrol demand in regional locations as well as lag effects from increasing wholesale prices
A couple of factors may have contributed to retail prices in regional locations being lower than prices in the 5 largest cities in 2020–21.
5.3.1 Less frequent COVID-19 restrictions and lockdowns occurred in regional locations than in the 5 largest cities
Petrol retailers in the 5 largest cities, faced with a reduction in demand associated with various COVID-19 restrictions and lockdowns, may have been setting retail prices higher to partially cover their fixed costs.
As noted in chapter 4, lower petrol demand may have influenced higher GIRDs (and therefore higher retail prices) in the 5 largest cities in 2020–21.
47 Report on the Australian petroleum market – June 2021
Demand may have been more stable in many regional locations, and therefore retailers in those locations may not have had the same incentive to increase their retail prices by as much.
5.3.2 Retail prices in regional locations generally took longer to reflect increasing wholesale prices from November 2020, compared with the 5 largest cities
While retail petrol prices in regional locations generally follow movements in wholesale prices, they often do not respond as quickly – either up or down – as do prices in the 5 largest cities. The frequency of retail site turnover of fuel influences these lags. They are longer in regional locations where volume turnover is smaller and the degree of competition is often not as intense.
Both of these influences may have contributed to average retail prices in regional locations being relatively lower in 2020–21 compared with the 5 largest cities. The extent of their influence is likely to vary between regional locations. Differing levels of COVID-19 restrictions were applied across the country, and the length of lags varies among regional locations.
5.4 Retail prices and GIRDs in VictoriaThe ACCC analysed average retail prices and GIRDs in a number of locations in Victoria to explore the effects of the factors outlined in section 5.3. Although many parts of Australia faced lockdowns in 2020–21, Victoria was chosen for analysis because it experienced several lockdowns during the year, including substantial periods of stricter restrictions in Melbourne compared with Victorian regional areas.
5.4.1 Petrol prices in Victorian regional locations were lower compared with Melbourne prices in 2020–21
Chart 5.3 shows monthly average retail petrol prices in Melbourne and average prices across Victorian regional locations in aggregate from January 2019 to June 2021. The chart also shows monthly average TGPs in Melbourne as benchmark wholesale prices.
Two periods highlight the differences between retail prices in Melbourne and Victorian regional locations:
� In 2019, before the influence of COVID-19, retail prices in Victorian regional locations were, on average, 0.9 cpl lower than prices in Melbourne.
� In 2020–21, average retail prices in Victorian regional locations were 8.0 cpl lower than average prices in Melbourne.
– This was a year when various COVID-19 restrictions were implemented across Victoria and wholesale prices trended upwards from November 2020.
48 Report on the Australian petroleum market – June 2021
Chart 5.3 Monthly average retail petrol prices in Melbourne and Victorian regional locations, and monthly average TGPs in Melbourne: January 2019 to June 2021
80
90
100
110
120
130
140
150
160Ja
n–1
9
Feb
–19
Mar
–19
Ap
r–1
9
May
–19
Jun
–19
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Melbourne retail prices Average retail prices in Victorian regional locations Melbourne TGPs
2020–21 ave regional-city di�: -8.0 cpl2019 ave regional-city di�: -0.9 cpl
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil and Viva Energy.
Note: A negative number means that average regional prices are lower than average Melbourne prices.
5.4.2 GIRDs in Victorian regional locations were also lower compared with GIRDs in Melbourne in 2020–21
Chart 5.3 also shows how retail prices in both Melbourne and Victorian regional locations compare with TGPs over time – indicating the GIRDs for these locations.56
� In 2019, while there is some variation, the difference between retail prices and TGPs appears relatively similar over time for both Melbourne and Victorian regional locations.
� In 2020–21, Melbourne retail prices were notably higher than TGPs compared with retail prices in Victorian regional locations.
In the interim period – January to June 2020 – there was a sharp fall in TGPs after international benchmark prices decreased significantly between February and April 2020. In response, average petrol prices in Melbourne decreased substantially whereas average petrol prices in regional locations took longer to fall.
Table 5.2 shows average GIRDs in Melbourne and 15 Victorian regional locations for 3 periods – 2019, January to June 2020, and 2020–21 – and the change between 2019 and 2020–21.57
56 Many of the regional locations in Victoria included in this chart obtain their fuel from terminals in and around Melbourne.
57 These locations are the 15 largest Victorian locations by population monitored by the ACCC.
49 Report on the Australian petroleum market – June 2021
Table 5.2: Average GIRDs in Melbourne and 15 Victorian regional locations – cpl
Location 2019 January to June 2020
2020–21 Change: 2019 to 2020–21
Melbourne 13.0 17.8 20.5 7.5
Geelong 9.7 12.2 8.5 -1.2
Ballarat 5.2 11.4 8.0 2.8
Bendigo 7.2 18.0 9.6 2.4
Mildura 13.7 20.9 10.6 -3.1
Shepparton 8.6 18.4 12.9 4.3
Wodonga 10.1 18.6 13.3 3.2
Warrnambool 10.6 19.4 6.3 -4.3
Traralgon 9.3 17.8 9.9 0.6
Wangaratta 8.2 18.7 12.5 4.3
Horsham 15.6 21.2 15.2 -0.4
Moe 8.4 17.6 8.9 0.5
Morwell 6.2 16.4 8.4 2.2
Sale 13.0 24.7 12.3 -0.7
Bairnsdale 7.7 16.9 9.0 1.3
Echuca 12.4 19.8 12.3 -0.1
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil and Viva Energy.
The table shows that:
� Compared with 2019, average GIRDs in January to June 2020 generally increased by more in regional locations than in Melbourne.
– Average GIRDs in Melbourne increased by 4.8 cpl, whereas the average increase in GIRDs in regional locations was 8.4 cpl.
– For most regional locations the increase in GIRDs was larger in this period, as retail prices in regional locations took longer to reflect the lower TGPs.
� Compared with January to June 2020, average GIRDs in 2020–21 increased further in Melbourne (by 2.7 cpl), whereas they decreased in all regional locations.
� The net change in GIRDs between 2019 and 2020–21 was significantly higher in Melbourne than in all regional locations, and in 6 regional locations this change was negative.
– Melbourne’s GIRDs increased by 7.5 cpl.
– In contrast, the average change in GIRDs in the regional locations was an increase of 0.8 cpl. This ranged from a 4.3 cpl increase in Shepparton and Wangaratta to a 4.3 cpl decrease in Warrnambool.
Chart 5.4 shows monthly average GIRDs in Melbourne and Mildura from January 2019 to June 2021, illustrating the significant change in GIRDs over this period.
50 Report on the Australian petroleum market – June 2021
Chart 5.4: Monthly average GIRDs in Melbourne and Mildura: January 2019 to June 2021
0
5
10
15
20
25
30
35
40Ja
n–1
9
Feb
–19
Mar
–19
Ap
r–1
9
May
–19
Jun
–19
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Melbourne Mildura
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil and Viva Energy.
Note: The period between the dotted lines is January to June 2020.
The chart shows that:
� From February to April 2020 (when TGPs decreased substantially), GIRDs increased in both Melbourne and Mildura. The increase in Mildura was significantly larger than in Melbourne.
� Between April and May 2020, as TGPs subsequently increased, GIRDs in both Melbourne and Mildura decreased.
� From June 2020:
– GIRDs in Melbourne increased again and were at relatively high levels for many months in 2020–21.
– In contrast, GIRDs in Mildura returned to similar levels as those experienced in 2019, and in 2021 GIRDs decreased further, potentially reflecting lags between increases in wholesale prices and changes retail prices.
5.4.3 Movements in retail prices and GIRDs in regional market study locations exhibited similar trends
The ACCC undertook 4 regional petrol market studies between 2015 and 2017. These studies examined petrol markets in Darwin, Launceston, Armidale and Cairns. The ACCC has continued to monitor and report on petrol prices and GIRDs in these locations over time. Detailed analysis of these locations is in appendix B.
Movements in retail prices and GIRDs in the regional market study locations exhibited similar trends to those noted above in Victorian regional locations. In 2020–21:
� annual average prices in Darwin, Armidale and Cairns were lower than average prices in the 5 largest cities, while average prices in Launceston were marginally higher
� annual average GIRDs in all of the market study locations were lower than average GIRDs in the 5 largest cities.
51 Report on the Australian petroleum market – June 2021
5.5 The difference between regional and city prices varies between jurisdictions
Charts 5.5 to 5.11 show 7–day rolling average retail petrol prices in regional locations in each state and the Northern Territory, along with those of the relevant capital city, from 1 July 2019 to 30 June 2021. These charts also show the average differential between prices in regional locations in the state/territory and the respective capital city in the March and June quarters 2021, and 2019–20 and 2020–21.
The charts show that:
� In the June quarter 2021, average regional prices were lower than average capital city prices in New South Wales, Victoria, Queensland and Tasmania, and higher in South Australia, Western Australia and the Northern Territory.
– This differential ranged from regional prices being 6.8 cpl lower in Queensland to being 10.7 cpl higher in the Northern Territory.
� Compared with the March quarter 2021, in the June quarter 2021, average prices in regional locations were relatively higher compared with their respective capital city in all jurisdictions except Queensland and Tasmania.
� In 2020–21, annual average regional prices were lower than average capital city prices in New South Wales, Victoria, Queensland and Tasmania, and higher in South Australia, Western Australia and Northern Territory.
– This differential ranged from regional prices being 8.0 cpl lower in Victoria, to being 10.0 cpl higher in the Northern Territory.
� Compared with 2019–20, in 2020–21 average prices in regional locations were relatively lower compared with their respective capital city in all jurisdictions except Tasmania.
Chart 5.5: Seven-day rolling average petrol prices in New South Wales regional locations and Sydney: 1 July 2019 to 30 June 2021
80
90
100
110
120
130
140
150
160
170
180
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
New South Wales regional locations Sydney
2020–21 avg: -1.8 cpl2019–20 avg: 5.8 cpl
Mar–21 avg:-3.1 cpl
Jun–21 avg:-2.1 cpl
Source: ACCC calculations based on data from FUELtrac.
Notes: E10 prices are used for Sydney and RULP prices are used for all New South Wales regional locations. A 7–day rolling average price is the average of the current day’s price and prices on the 6 previous days. A negative number means that average regional prices are lower than average capital city prices.
52 Report on the Australian petroleum market – June 2021
Chart 5.6: Seven-day rolling average petrol prices in Victorian regional locations and Melbourne: 1 July 2019 to 30 June 2021
2020–21 avg: –8.0 cpl2019–20 avg: –0.2 cpl
80
90
100
110
120
130
140
150
160
170
180Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Victorian regional locations Melbourne
Mar–21 avg:–7.6 cpl
Jun–21 avg:-6.1 cpl
Source: ACCC calculations based on data from FUELtrac.
Notes: A 7–day rolling average price is the average of the current day’s price and prices on the 6 previous days. A negative number means that average regional prices are lower than average capital city prices.
Chart 5.7: Seven-day rolling average petrol prices in Queensland regional locations and Brisbane: 1 July 2019 to 30 June 2021
80
90
100
110
120
130
140
150
160
170
180
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Queensland regional locations Brisbane
Mar–21 avg:–5.7 cpl
Jun–21 avg:–6.8 cpl
2020–21 avg: –6.3 cpl2019–20 avg: 0.1 cpl
Source: ACCC calculations based on data from FUELtrac.
Notes: A 7–day rolling average price is the average of the current day’s price and prices on the 6 previous days. A negative number means that average regional prices are lower than average capital city prices.
53 Report on the Australian petroleum market – June 2021
Chart 5.8: Seven-day rolling average petrol prices in South Australian regional locations and Adelaide: 1 July 2019 to 30 June 2021
80
90
100
110
120
130
140
150
160
170
180Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
South Australian regional locations Adelaide
Mar–21 avg:-4.2 cpl
Jun–21 avg:3.6 cpl
2020–21 avg: 0.1 cpl2019–20 avg: 1.6 cpl
Source: ACCC calculations based on data from FUELtrac.
Notes: A 7–day rolling average price is the average of the current day’s price and prices on the 6 previous days. A negative number means that average regional prices are lower than average capital city prices.
Chart 5.9: Seven-day rolling average petrol prices in Western Australian regional locations and Perth: 1 July 2019 to 30 June 2021
80
90
100
110
120
130
140
150
160
170
180
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Western Australian regional locations Perth
Mar–21 avg:3.0 cpl
Jun–21 avg:4.6 cpl
2020–21 avg: 4.4 cpl2019–20 avg: 11.8 cpl
Source: ACCC calculations based on data from FUELtrac.
Note: A 7–day rolling average price is the average of the current day’s price and prices on the 6 previous days.
54 Report on the Australian petroleum market – June 2021
Chart 5.10: Seven-day rolling average petrol prices in Tasmanian regional locations and Hobart: 1 July 2019 to 30 June 2021
80
90
100
110
120
130
140
150
160
170
180Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Tasmanian regional locations Hobart
Mar–21 avg:-0.3 cpl
Jun–21 avg:-1.5 cpl
2020–21 avg: -0.5 cpl2019–20 avg: -2.2 cpl
Source: ACCC calculations based on data from FUELtrac.
Notes: A 7–day rolling average price is the average of the current day’s price and prices on the 6 previous days.
A negative number means that average regional prices are lower than average capital city prices.
Chart 5.11: Seven-day rolling average petrol prices in Northern Territory regional locations and Darwin: 1 July 2019 to 30 June 2021
80
90
100
110
120
130
140
150
160
170
180
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Northern Territory regional locations Darwin
Mar–21 avg:10.2 cpl
Jun–21 avg:10.7 cpl
2020–21 avg: 10.0 cpl2019–20 avg: 14.3 cpl
Source: ACCC calculations based on data from FUELtrac.
Note: A 7–day rolling average price is the average of the current day’s price and prices on the 6 previous days.
Charts 5.5 to 5.11 also show that price cycles in a number of the capital cities significantly influence price comparisons between capital cities and regional locations over the short term. An example is the price differential between Sydney and regional locations in New South Wales in May 2020.
Chart 5.12 shows 7–day rolling average retail petrol prices in Canberra from 1 July 2019 to 30 June 2021. There are no prices available for locations in the Australian Capital Territory other than Canberra.
55 Report on the Australian petroleum market – June 2021
Chart 5.12: Seven-day rolling average petrol prices in Canberra: 1 July 2019 to 30 June 2021
80
90
100
110
120
130
140
150
160
170
180Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
Source: ACCC calculations based on data from FUELtrac.
Note: A 7–day rolling average price is the average of the current day’s price and prices on the 6 previous days.
56 Report on the Australian petroleum market – June 2021
6. Crude oil and refined petrol price movements
International refined petrol prices (which are influenced by international crude oil prices) and the AUD–USD exchange rate, largely determine retail petrol prices in Australia.
Crude oil prices are an important influence on movements in refined petrol prices around the world. There are a number of international benchmarks used for pricing crude oil, including West Texas Intermediate (WTI), Brent, Tapis and Dubai. The most widely used benchmark in global markets is Brent crude oil.
The price of Singapore Mogas 95 Unleaded (Mogas 95) is the relevant international benchmark price for determining RULP prices in Australia. This benchmark is used due to Australia’s proximity to Singapore, which is one of the world’s most important petroleum trading and refining centres.
Chapter 4 shows movements in the AUD–USD exchange rate.
6.1 Crude oil and refined petrol prices increased to their highest levels in over 2 years
Chart 6.1 shows movements in weekly average Brent crude oil and Mogas 95 prices in the 2 years to June 2021.
Chart 6.1: Weekly average Brent crude oil and Mogas 95 prices: July 2019 to June 2021
0
10
20
30
40
50
60
70
80
90
100
Jul–
19
Oct
–19
Jan
–20
Ap
r–2
0
Jul–
20
Oct
–20
Jan
–21
Ap
r–2
1
US
D p
er b
l
Brent crude oil Mogas 95
Source: ACCC calculations based on data from OPIS and Argus Media.
57 Report on the Australian petroleum market – June 2021
From July to December 2019 weekly average Brent crude oil prices were within a USD 12 per barrel band between around USD 58 per barrel and around USD 70 per barrel. In early 2020 prices began trending downwards before decreasing sharply to around USD 12 per barrel in late April 2020.58 They then increased sharply in May and June 2020 and remained relatively stable from July to November 2020, in a USD 9 per barrel band between around USD 37 and around USD 46 per barrel. They increased from December 2020 reaching a peak of around USD 68 per barrel in mid-March 2021, before decreasing to around USD 63 per barrel at the end of March 2021.
Weekly average Brent crude oil prices increased for most of the June quarter 2021, reaching a peak of around USD 76 per barrel at the end of the quarter. The last time weekly average Brent crude oil prices were at this level was in October 2018.
Weekly average Mogas 95 prices moved in a similar manner to Brent crude oil prices over the 2–year period. They were within a USD 11 per barrel band between around USD 68 per barrel and around USD 79 per barrel from July to December 2019. Mogas 95 prices similarly decreased sharply to around USD 19 per barrel in late April 2020.59 They then increased sharply in May and June 2020 and remained relatively stable from July to November 2020, in a USD 7 per barrel band between around USD 43 and around USD 50 per barrel. They increased from December 2020 reaching a peak of around USD 75 per barrel in mid-March 2021, before decreasing to around USD 71 per barrel at the end of March 2021.
Weekly average Mogas 95 prices increased for most of the June quarter 2021, reaching a peak of around USD 83 per barrel at the end of the quarter. The last time weekly average Mogas 95 prices were at this level was in April 2019.
Quarterly average Brent crude oil and Mogas 95 prices were higher in the June quarter 2021 compared with the March quarter 2021:
� quarterly average Brent crude oil prices were around USD 69 per barrel (an increase of USD 8 per barrel, or around 13%, from the previous quarter)
� quarterly average Mogas 95 prices were around USD 77 per barrel (an increase of USD 10 per barrel, or around 15%).
On an annual average basis:
� Brent crude oil prices were around USD 54 per barrel in 2020–21 (an increase of USD 3 per barrel, or around 6%, from 2019–20)
� Mogas 95 prices were around USD 60 per barrel in both 2019–20 and 2020–21.
6.2 The OPEC cartel and COVID-19 were the main factors influencing crude oil prices
Two factors largely influenced movements in crude oil prices over the past 2 years:
� agreements (and, at times, disagreements) made by the Organisation of the Petroleum Exporting Countries (OPEC) cartel, and some other crude oil producing countries (including Russia), to cut production
� the influence of the COVID-19 pandemic.
OPEC and some other crude oil producing countries continued previous crude oil production cuts throughout 2019, and into early 2020.60 In December 2019, they agreed to an increase in production cuts until 31 March 2020, increasing the agreed cuts from 1.2 million barrels per day to 1.7 million barrels per day.61
58 Weekly average Brent crude oil prices were last at this level in early March 1999 (in nominal terms).
59 Weekly average Mogas 95 prices were last at this level in mid-June 1999 (in nominal terms).
60 Reuters, OPEC extends oil cut to prop up prices as economy weakens, 1 July 2019, at: https://www.reuters.com/article/usoil-opec/opec-extends-oil-cut-to-prop-up-prices-as-economy-weakens-idUSKCN1TW1LF, accessed on 25 August 2021.
61 OPEC, The 7th OPEC and non-OPEC Ministerial Meeting concludes, media release, 6 December 2019, at: https://www.opec.org/opec_web/en/press_room/5797.htm, accessed on 25 August 2021.
58 Report on the Australian petroleum market – June 2021
From mid-January 2020 news coming out of China about the COVID-19 outbreak, and its impact on Chinese economic activity, led to a fall in crude oil prices. On 30 January 2020, the World Health Organisation declared the virus a Public Health Emergency of International Concern.62 As countries imposed restrictions on travel and economic activity, demand for crude oil and refined petrol products decreased significantly.
The inability of the OPEC cartel and other crude oil producing countries to agree on further production cuts at their meeting on 5 March 2020 compounded this decrease in demand. On 6 March 2020, Saudi Arabia (the world’s largest oil exporter) boosted production to its full capacity of 12.3 million barrels per day. Saudi Arabia also announced discounts of almost 20% in key markets. The result was an immediate drop of more than 30% in crude oil prices.63
In April 2020, OPEC and other crude oil producing countries agreed to significant cuts in output, by 9.7 million barrels per day, in May and June 2020.64 The agreement came as crude oil prices continued to decrease due to falling worldwide consumption resulting from COVID-19 and a 13-month high in OPEC’s oil output in April 2020.65 These production cuts ultimately led to a steady increase in crude oil prices to the end of June 2020.
In July and August 2020, crude oil prices remained relatively stable, but prices fell in September 2020 due to an increase in the supply of crude oil from OPEC countries and concerns of another demand shock due to rising cases of COVID-19 globally.66
In November 2020, crude oil prices increased in response to news of the roll-out of COVID-19 vaccines and a decline in the US dollar.67 On 3 December 2020, OPEC and other crude oil producing countries agreed to increase output by 0.5 million barrels per day from 1 January 2021.68
Production cuts and increasing global demand meant crude oil prices continued to increase in the March quarter 2021. In January 2021, Saudi Arabia announced it would voluntarily cut its own production by an additional 1.0 million barrels per day in February and March 2021.69 Demand for crude oil was also influenced by cold weather in northern Asia, Europe and the United States.70 In March 2021, the OPEC cartel was withholding around 8.0 million barrels per day (including the voluntary cuts by Saudi Arabia). At the OPEC and non-OPEC Ministerial Meeting on 4 March 2021, the members agreed to extend most existing production cuts into April 2021.71
62 World Health Organisation, Statement on the second meeting of the International Health Regulations (2005) Emergency Committee regarding the outbreak of novel coronavirus (2019-nCoV), 30 January 2020, at: https://www.who.int/news/item/30-01-2020-statement-on-the-second-meeting-of-the-international-health-regulations-(2005)-emergency-committee-regarding-the-outbreak-of-novel-coronavirus-(2019-ncov), accessed on 25 August 2021.
63 The World Bank, Coping with a Dual Shock: COVID-19 and Oil Prices, Brief, 14 April 2020, at: https://www.worldbank.org/en/region/mena/brief/coping-with-a-dual-shock-coronavirus-covid-19-and-oil-prices, accessed on 25 August 2021.
64 Reuters, Oil mixed as demand worries offset gains from output cut deal, 13 April 2020, at: https://www.reuters.com/article/us-global-oil/oil-futures-little-changed-despite-record-output-cut-by-opec-idUSKCN21U0WQ?feedType=mktg&feedName=ousivMolt&WT.mc_id=Partner-Google, accessed on 25 August 2021.
65 Reuters, OPEC April oil output surges to 13-month high before new cut deal, 1 May 2020, at: https://www.reuters.com/article/oil-opec-survey-idUSL8N2CI8JG, accessed on 25 August 2021.
66 Reuters, OPEC September oil output rises for third month on Libya restart, Iran, 1 October 2020, at: https://www.reuters.com/article/us-oil-opec-survey-idUSKBN26L2XU, accessed on 25 August 2021.
67 Reuters, Oil settles up, marking seventh straight weekly gain, 18 December 2020, at: https://www.reuters.com/article/usglobal-oil/oil-settles-up-marking-seventh-straight-weekly-gain-idUSKBN28S09Q, accessed on 25 August 2021.
68 OPEC, 13th OPEC and non-OPEC Ministerial Meeting concludes, press release, 5 January 2021, at: https://www.opec.org/opec_web/en/press_room/6310.htm, accessed on 25 August 2021.
69 Reuters, Saudi voluntary oil cut to help with low demand in first quarter, OPEC chief says, 14 January 2021, at: https://www.reuters.com/article/us-global-oil-opec-idUSKBN29I20C, accessed on 25 August 2021.
70 International Energy Agency, Oil Market Report – March 2021, at: https://www.iea.org/reports/oil-market-report-march-2021, accessed on 25 August 2021.
71 Reuters, OPEC+ extends most oil output cuts into April, Saudi keeps voluntary curb, 4 March 2021, at: https://www.reuters.com/article/oil-opec-cuts-int-idUSKBN2AW0WA, accessed on 25 August 2021; and OPEC, 14th OPEC and non-OPEC Ministerial Meeting, press release, 4 March 2021, at: https://www.opec.org/opec_web/en/press_room/6375.htm, accessed on 25 August 2021.
59 Report on the Australian petroleum market – June 2021
On 1 April 2021, OPEC and non-OPEC countries agreed to increase output by 0.35 million barrels per day in May and June, and 0.4 million barrels per day in July.72 In response to this news, crude oil prices decreased by around 5% in early April.73 Throughout the remainder of April and into May 2021, crude oil prices increased as strong US economic data, a weaker US dollar and an expected recovery in demand outweighed concerns about higher COVID-19 cases in Brazil and India.74 In June 2021, recovering demand and falling US stockpiles led to crude oil prices rising further.75
6.3 Refiner margins increased but remained well below the 10-year average
The refiner margin is the difference between the price of refined petrol and the price of crude oil. In the June quarter 2021, the average refiner margin was USD 7.8 per barrel (around 6.4 cpl in Australian cents per litre terms), an increase of USD 1.8 per barrel (AUD 1.5 cpl) from the previous quarter (USD 6.0 per barrel or AUD 4.9 cpl).
The average refiner margin in the June quarter 2021 was significantly lower than the 10–year real average refiner margin (USD 11.9 per barrel, or AUD 9.0 cpl).
In 2020–21, the annual average refiner margin was USD 5.8 per barrel (or AUD 4.9 cpl). This was USD 2.7 per barrel (AUD 3.1 cpl) lower than the average refiner margin in 2019–20 (USD 8.5 per barrel or AUD 8.0 cpl).
The annual average refiner margin in 2020–21 was only around half the 10–year average. This underscores the challenging year Australian refineries faced, culminating in ExxonMobil and bp announcing the closures of their respective refineries.
6.4 Crude oil prices increased above the long-term average
As with many commodities, crude oil prices fluctuate greatly. In the short term, market sentiment about economic conditions and geo-political events can drive rapid movements in crude oil prices. Over the medium to longer term, supply and demand factors drive prices, with periods of high or low prices lasting several years.
Extended periods of high crude oil prices provide an incentive for producers to invest in exploration and expansion. This leads to an increase in supply, which in turn puts downward pressure on prices. Conversely, when crude oil prices are low, producers tend not to invest, which puts upward pressure on prices, as supply is insufficient to meet the growth in demand.
Chart 6.2 shows that, over the 40 years to June 2021, WTI crude oil prices in real terms were on average around USD 63 per barrel. In the June quarter 2021, real WTI crude oil prices were on average around USD 67 per barrel, which was USD 7 per barrel higher than the March quarter 2021 (USD 60 per barrel) and USD 4 per barrel higher than the 40-year average.
72 Reuters, Oil rises as OPEC+ decides on production policy, 1 April 2021, at: https://www.reuters.com/article/idUSKBN2BO5X6, accessed on 25 August 2021.
73 Reuters, Oil down 5% as rising OPEC+, Iranian output weighs, 5 April 2021, at: https://www.reuters.com/article/idUSKBN2BS0T4, accessed on 25 August 2021.
74 Reuters, Oil climbs to fresh 6-week high on bullish demand, 29 April 2021, at: https://www.reuters.com/world/middle-east/oil-prices-extend-gains-demand-outlook-offsets-india-concerns-2021-04-29/, accessed on 25 August 2021.
75 Reuters, Oil rises on lower U.S. stockpiles, demand recovery, 30 June 2021, at: https://www.reuters.com/business/energy/oil-prices-climb-second-day-after-us-stockpiles-fall-2021-06-30/, accessed on 25 August 2021.
60 Report on the Australian petroleum market – June 2021
Chart 6.2: Monthly average real WTI crude oil prices: July 1981 to June 2021
0
20
40
60
80
100
120
140
160
18019
81
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
2021
US
D p
er b
l
WTI 40–year average
Source: ACCC calculations based on data used with permission from The Wall Street Journal, WSJ.com, Copyright 2015 Dow Jones & Company, Inc. All rights reserved, Reuters and U.S. Department of Labor, Bureau of Labor Statistics, Consumer Price Index for all urban consumers, at: https://beta.bls.gov/dataViewer/view/timeseries/CUUR0000SA0, accessed on 25 August 2021.
Note: Real prices are shown in June 2021 dollars.
61 Report on the Australian petroleum market – June 2021
7. Diesel and LPG prices
7.1 Retail diesel prices increased in the quarterQuarterly average retail diesel prices in the 5 largest cities were 137.5 cpl in the June quarter 2021, an increase of 8.4 cpl from the March quarter 2021 (129.1 cpl).
The price of Singapore Gasoil with 10 parts per million sulphur content (Gasoil 10 ppm) is the appropriate international benchmark for the wholesale price of diesel. International demand for diesel is different from that for petrol, in part because of diesel’s off-road, industrial and electricity generation uses. However, both petrol and diesel are refined from crude oil and their prices broadly tend to follow similar movements over the long term.
Chart 7.1 shows that 7–day rolling average retail diesel prices in the 5 largest cities broadly tracked Gasoil 10 ppm prices over the 2 years to 30 June 2021.
Chart 7.1: Seven-day rolling average retail diesel prices in the 5 largest cities and Gasoil 10 ppm prices: 1 July 2019 to 30 June 2021
15
25
35
45
55
65
75
85
95
85
95
105
115
125
135
145
155
165
Jul–
19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
cpl
Retail prices (LHS) Gasoil 10 ppm (lagged 11 days) (RHS)
Source: ACCC calculations based on data from FUELtrac, OPIS, Argus Media and RBA.
Note: Gasoil 10 ppm prices are lagged by 11 days as there is generally around a one- to 2-week lag between changes in international prices and changes in retail prices in the 5 largest cities.
Seven-day rolling average retail diesel prices increased over the June quarter 2021. Prices were 136.2 cpl at the beginning of the quarter and increased to 142.4 cpl at the end of the quarter. Seven-day rolling average Gasoil 10 ppm prices in Australian cents per litre terms were 57.8 cpl at the beginning of the quarter and increased to 64.6 cpl at the end of the quarter.
Quarterly average Gasoil 10 ppm prices in the June quarter 2021 in Australian cents per litre were 60.4 cpl, an increase of 6.7 cpl from the March quarter 2021 (53.7 cpl).
Unlike petrol prices, diesel prices in the 5 largest cities do not move in cycles. Diesel prices may not have price cycles because a large proportion of sales are to commercial users who purchase diesel on a contractual basis. According to the Australian Institute of Petroleum (AIP), only around 25% of the diesel used in Australia is sold through retail outlets, and much of that is sold to account customers with very little sold to private customers.76
76 Australian Institute of Petroleum, Facts about diesel prices & the Australian fuel market, at: https://www.aip.com.au/sites/default/files/download-files/2020-02/Facts%20about%20Diesel%20Prices%20and%20the%20Australian%20Fuel%20Market.pdf, accessed on 25 August 2021.
62 Report on the Australian petroleum market – June 2021
7.2 Gasoil 10 ppm was the largest component of average diesel prices in the quarter
Chart 7.2 shows the 3 broad components of average retail diesel prices in the 5 largest cities in the June quarter 2021.
Chart 7.2: Components of average retail diesel prices in the 5 largest cities in the June quarter 2021
Other costs and marginsTaxesGasoil 10ppm
137.5 cpl
DIESEL
60.4
40
16
55.2
21.9
cpl%
44
Source: ACCC calculations based on data from FUELtrac, Argus Media, RBA and ATO.
The chart shows that in the June quarter 2021:
� Gasoil 10 ppm accounted for 44% of average diesel prices, an increase of 2 percentage points from the March quarter 2021
� taxes accounted for 40% of average diesel prices, a decrease of 2 percentage points77
� other costs and margins accounted for 16% of average diesel prices, the same as in the March quarter 2021.
As with average retail petrol prices in the June quarter 2021, the international benchmark price accounted for the largest component of average retail diesel prices in the quarter.
77 On 1 February 2021, excise on diesel increased by 0.4 cpl to 42.7 cpl.
63 Report on the Australian petroleum market – June 2021
7.3 Taxes were the largest component of average diesel prices in 2020–21
In 2020–21, annual average retail prices of diesel in the 5 largest cities were 126.3 cpl, a decrease of 15.5 cpl from 2019–20 (141.8 cpl).
Chart 7.3 shows that taxes were the largest component of annual average diesel prices in 2020–21.
Chart 7.3: Components of annual average retail diesel prices in the 5 largest cities in 2020–21
Other costs and marginsTaxesGasoil 10ppm
126.3 cpl
DIESEL
49.2
43
18
53.9
23.2
cpl%
39
Source: ACCC calculations based on data from FUELtrac, Argus Media, RBA and ATO.
Chart 7.3 shows that in 2020–21:
� taxes accounted for 43% of average diesel prices, 4 percentage points higher than in 2019–2078
� Gasoil 10 ppm accounted for 39% of average diesel prices, 3 percentage points lower than in 2019–20
� other costs and margins accounted for 18% of average diesel prices, 1 percentage point lower than in 2019–20.
7.4 Retail LPG prices increased in the quarterQuarterly average retail LPG prices in the 5 largest cities in the June quarter 2021 were 90.9 cpl, an increase of 5.3 cpl from the March quarter 2021 (85.6 cpl).79
The Saudi Aramco Contract Prices for propane and butane (Saudi CP) are the appropriate international benchmarks for wholesale LPG prices. These prices only change once a month, at the start of each month. International LPG prices loosely move in line with international refined petrol and diesel prices.
Chart 7.4 shows that movements in retail LPG prices over the 2 years to 30 June 2021 were less responsive, both up and down, to movements in international benchmark prices.
78 The rate of excise on diesel increased by 0.4 cpl in 2020–21.
79 References to LPG refer to automotive liquefied petroleum gas.
64 Report on the Australian petroleum market – June 2021
Chart 7.4: Seven-day rolling average retail LPG prices in the 5 largest cities and monthly Saudi CP benchmarks: 1 July 2019 to 30 June 2021
5
15
25
35
45
55
65
35
45
55
65
75
85
95Ju
l–19
Au
g–1
9
Sep
–19
Oct
–19
No
v–1
9
Dec
–19
Jan
–20
Feb
–20
Mar
–20
Ap
r–2
0
May
–20
Jun
–20
Jul–
20
Au
g–2
0
Sep
–20
Oct
–20
No
v–2
0
Dec
–20
Jan
–21
Feb
–21
Mar
–21
Ap
r–2
1
May
–21
Jun
–21
cpl
cpl
Retail prices (LHS) Saudi CP (RHS)
Source: ACCC calculations based on data from FUELtrac, Reuters and RBA.
Seven-day rolling average retail LPG prices were stable over the June quarter 2021, whereas the Saudi CP benchmarks in Australian cents per litre decreased by 5.8 cpl from the end of March 2021. The benchmark price was 42.9 cpl in March 2021 and 37.1 cpl in June 2021.
Quarterly average Saudi CP benchmarks in the June quarter 2021 were 36.6 cpl, a decrease of 4.7 cpl from the March quarter 2021 (41.3 cpl).
As the Saudi CP benchmarks only change at the start of each month, the relationship between movements in the international benchmark prices and retail prices for LPG is different from petrol and diesel. Furthermore, non-transport factors, such as demand for heating (particularly in the Northern Hemisphere) also influence international LPG prices.
Like diesel prices, retail LPG prices tend to be less volatile than petrol prices and do not move in cycles. LPG usage in Australia is significantly less than petrol and diesel usage, and there are fewer retailers of LPG, particularly outside Victoria (where around half of Australia’s LPG is sold).
65 Report on the Australian petroleum market – June 2021
7.5 Other costs and margins were a relatively large component of average LPG prices in the quarter
Chart 7.5 shows the 3 broad components of average retail LPG prices in the 5 largest cities in the June quarter 2021.
Chart 7.5: Components of average retail LPG prices in the 5 largest cities in the June quarter 2021
Other costs and marginsTaxesSaudi CP
90.9 cpl
LPG
36.6
24
35
22.2
32.1
cpl%
40
Source: ACCC calculations based on data from FUELtrac, Reuters, RBA and ATO.
Note: Percentages in the chart do not total 100% due to rounding.
The chart shows that in the June quarter 2021:
� the Saudi CP international benchmarks accounted for 40% of average retail LPG prices, a decrease of 8 percentage points from the March quarter 2021
� taxes accounted for 24% of average retail LPG prices, a decrease of 1 percentage point80
� other costs and margins accounted for 35% of average retail LPG prices, an increase of 9 percentage points.
Other costs and margins make up a relatively large proportion of the retail price for LPG compared with those for petrol and diesel because of the higher transportation and storage costs for LPG, and the lower rate of excise.
80 On 1 February 2021, excise on automotive LPG increased by 0.1 cpl to 13.9 cpl.
66 Report on the Australian petroleum market – June 2021
7.6 Other costs and margins were also a relatively large component of average LPG prices in 2020–21
In 2020–21, annual average retail LPG prices in the 5 largest cities were 82.5 cpl, an increase of 1.8 cpl from 2019–20 (80.7 cpl).
Chart 7.6: Components of annual average retail LPG prices in the 5 largest cities in 2020–21
Other costs and marginsTaxesSaudi CP
82.5 cpl
LPG
34.3
26
33
21.3
26.9
cpl%
42
Source: ACCC calculations based on data from FUELtrac, Reuters, RBA and ATO.
Note: Percentages in the chart do not total 100% due to rounding.
The chart shows that in 2020–21:
� the Saudi CP benchmarks accounted for 42% of average retail LPG prices, 1 percentage point higher than in 2019–20
� other costs and margins accounted for 33% of the average retail LPG prices, the same as in 2019–20
� taxes accounted for 26% of average retail LPG prices, the same as in 2019–20.81
81 The rate of excise on LPG increased by 0.1 cpl in 2020–21.
67 Report on the Australian petroleum market – June 2021
Appendix A: Petrol price data for monitored locationsThe ACCC monitors fuel prices in all capital cities and over 190 regional locations across Australia. Table A1 shows quarterly average retail petrol prices in the March quarter 2021 and the June quarter 2021, and the change between the 2 quarters, in these locations.82 It also shows the differential between average prices in each location and average prices across the 5 largest cities, and the location’s capital city, in the June quarter 2021 and 2020–21.83
Table A1: Quarterly average petrol prices in the March quarter 2021 and the June quarter 2021, and differentials in the June quarter 2021 and 2020–21 – cpl
Location Mar 2021 Jun 2021
Change
Mar to Jun 2021
Differential Jun 2021
Differential 2020–21
5 largest cities
Capital city
5 largest cities
Capital city
Sydney 132.8 143.6 10.8
Melbourne 136.2 144.5 8.3
Brisbane 135.6 146.8 11.2
Adelaide 132.1 135.2 3.1
Perth 130.3 139.9 9.6
5 largest cities 133.4 142.0 8.6
Hobart 133.7 146.4 12.7 4.4 2.4
Canberra 131.9 142.2 10.3 0.2 0.0
Darwin 126.4 139.9 13.5 -2.1 -4.6
New South Wales
Albury 126.8 137.2 10.4 -4.8 -7.9 -5.7 -6.8
Armidale 128.9 138.0 9.1 -4.0 -7.1 -3.7 -4.8
Ballina 134.1 146.3 12.2 4.3 1.2 1.6 0.5
Batemans Bay 133.1 146.9 13.8 4.9 1.8 0.7 -0.4
Bathurst 125.1 138.8 13.7 -3.2 -6.3 -4.1 -5.2
Bega 133.2 140.6 7.4 -1.4 -4.5 3.7 2.6
Broken Hill 135.3 148.2 12.9 6.2 3.1 3.8 2.7
Bulahdelah 121.3 133.4 12.1 -8.6 -10.2 -7.7 -7.4
Casino 128.3 142.0 13.7 0.0 -3.1 -2.2 -3.3
Central Coast 137.2 145.6 8.4 3.6 0.5 2.6 1.5
Coffs Harbour 130.0 146.3 16.3 4.3 1.2 -0.9 -2.0
Cooma 134.8 145.1 10.3 3.1 0.0 1.6 0.5
Coonabarabran 130.4 146.6 16.2 4.6 3.0 -0.8 -0.5
82 The source for all prices in this appendix is ACCC calculations based on data from FUELtrac. For a price to be included in the table there had to be a price observation on at least 75% of days in the quarter/year. Ten locations – Buronga, Oberon, Blackall, Charleville, Cunnamulla, Mt Isa, Normanton, Weipa, Coober Pedy and Orbost – did not have sufficient data for the March or June quarters 2021. E10 prices instead of RULP prices are reported in Sydney, Bulahdelah, Coonabarabran, Cowra, Gilgandra, Gunnedah, Wellington, West Wyalong and Yass.
83 In most New South Wales locations the table reports a RULP price. To calculate the differential with the price in Sydney, the differential between this price and the Sydney RULP price is calculated. In the June quarter 2021 the average price of RULP in Sydney was 145.1 cpl and in 2020–21 it was 130.8 cpl. Where the table reports an E10 price, the differential between this price and the Sydney E10 price is calculated.
Average prices in 2020–21 across the 5 largest cities were 129.7 pl. Average prices In each capital city were: Sydney (E10) – 129.4 cpl, Melbourne – 133.1 cpl, Brisbane – 133.6 cpl, Adelaide – 125.6 cpl, Perth – 126.7 cpl, Darwin – 125.1 cpl, Hobart – 132.1 cpl, and Canberra – 129.7 cpl.
68 Report on the Australian petroleum market – June 2021
Location Mar 2021 Jun 2021
Change
Mar to Jun 2021
Differential Jun 2021
Differential 2020–21
5 largest cities
Capital city
5 largest cities
Capital city
Cootamundra 128.9 138.2 9.3 -3.8 -6.9 -2.7 -3.8
Cowra 133.1 144.4 11.3 2.4 0.8 0.6 0.9
Deniliquin 130.1 141.8 11.7 -0.2 -3.3 0.1 -1.0
Dubbo 128.8 144.5 15.7 2.5 -0.6 -2.9 -4.0
Forbes 131.7 144.3 12.6 2.3 -0.8 1.7 0.6
Forster 128.5 143.3 14.8 1.3 -1.8 -2.3 -3.4
Gilgandra 127.5 141.7 14.2 -0.3 -1.9 -2.6 -2.3
Glen Innes 128.1 138.3 10.2 -3.7 -6.8 -1.2 -2.3
Goulburn 126.6 138.9 12.3 -3.1 -6.2 -5.4 -6.5
Grafton 133.3 149.2 15.9 7.2 4.1 0.0 -1.1
Griffith 125.6 136.5 10.9 -5.5 -8.6 -6.7 -7.8
Gundagai n/a 143.1 n/a 1.1 -2.0 n/a n/a
Gunnedah 121.2 134.2 13.0 -7.8 -9.4 -9.3 -9.0
Hay 126.9 138.4 11.5 -3.6 -6.7 -4.6 -5.7
Inverell 127.6 139.9 12.3 -2.1 -5.2 -4.7 -5.8
Jerilderie 127.1 136.8 9.7 -5.2 -8.3 -3.8 -4.9
Kempsey 125.2 138.2 13.0 -3.8 -6.9 -7.0 -8.1
Leeton 128.1 139.3 11.2 -2.7 -5.8 -2.7 -3.8
Lismore 128.4 142.7 14.3 0.7 -2.4 -3.9 -5.0
Lithgow 128.3 137.8 9.5 -4.2 -7.3 -5.3 -6.4
Merimbula 129.7 141.4 11.7 -0.6 -3.7 -2.5 -3.6
Mittagong 129.9 141.0 11.1 -1.0 -4.1 -3.0 -4.1
Moama 129.7 141.5 11.8 -0.5 -3.6 -3.9 -5.0
Moree 128.8 142.0 13.2 0.0 -3.1 -3.5 -4.6
Moruya 124.3 134.0 9.7 -8.0 -11.1 -8.5 -9.6
Moss Vale 132.3 143.0 10.7 1.0 -2.1 -0.5 -1.6
Mudgee 132.6 147.3 14.7 5.3 2.2 0.5 -0.6
Murwillumbah 140.3 149.0 8.7 7.0 3.9 8.9 7.8
Muswellbrook 121.4 131.6 10.2 -10.4 -13.5 -11.7 -12.8
Narrabri 131.1 142.2 11.1 0.2 -2.9 -1.2 -2.3
Newcastle 134.7 141.7 7.0 -0.3 -3.4 -0.4 -1.5
Nowra 125.9 138.5 12.6 -3.5 -6.6 -7.5 -8.6
Nyngan 126.3 137.7 11.4 -4.3 -7.4 -5.1 -6.2
Orange 124.5 138.7 14.2 -3.3 -6.4 -4.8 -5.9
Parkes 133.4 145.1 11.7 3.1 0.0 4.5 3.4
Port Macquarie 126.6 137.5 10.9 -4.5 -7.6 -3.0 -4.1
Queanbeyan 128.8 140.1 11.3 -1.9 -5.0 -4.0 -5.1
Singleton 129.6 143.6 14.0 1.6 -1.5 -1.8 -2.9
Tamworth 128.6 141.0 12.4 -1.0 -4.1 -5.5 -6.6
Taree 130.2 146.4 16.2 4.4 1.3 -0.8 -1.9
Temora 128.0 137.0 9.0 -5.0 -8.1 -1.5 -2.6
Tumut 130.2 142.3 12.1 0.3 -2.8 -0.2 -1.3
Tweed Heads South 142.6 149.1 6.5 7.1 4.0 6.5 5.4
69 Report on the Australian petroleum market – June 2021
Location Mar 2021 Jun 2021
Change
Mar to Jun 2021
Differential Jun 2021
Differential 2020–21
5 largest cities
Capital city
5 largest cities
Capital city
Ulladulla 126.8 141.6 14.8 -0.4 -3.5 -2.7 -3.8
Wagga Wagga 128.4 142.1 13.7 0.1 -3.0 -1.6 -2.7
Wauchope 127.8 139.5 11.7 -2.5 -5.6 -3.3 -4.4
Wellington 125.5 137.0 11.5 -5.0 -6.6 -5.2 -4.9
West Wyalong n/a 138.6 n/a -3.4 -5.0 -7.1 -6.8
Wollongong 143.5 145.0 1.5 3.0 -0.1 6.6 5.5
Woolgoolga 134.6 149.6 15.0 7.6 4.5 1.2 0.1
Yass 130.6 142.2 11.6 0.2 -1.4 -1.1 -0.8
Northern Territory
Alice Springs 138.4 150.7 12.3 8.7 10.8 7.1 11.7
Katherine 126.5 144.1 17.6 2.1 4.2 -3.2 1.4
Tennant Creek 146.8 158.4 11.6 16.4 18.5 14.9 19.5
Queensland
Atherton 129.1 140.2 11.1 -1.8 -6.6 -2.7 -6.6
Ayr 124.5 135.6 11.1 -6.4 -11.2 -9.2 -13.1
Biloela 123.9 135.8 11.9 -6.2 -11.0 -4.9 -8.8
Blackwater 129.2 138.9 9.7 -3.1 -7.9 -2.8 -6.7
Bowen 127.5 136.6 9.1 -5.4 -10.2 -5.0 -8.9
Bundaberg 123.2 133.1 9.9 -8.9 -13.7 -11.0 -14.9
Caboolture 135.4 147.1 11.7 5.1 0.3 3.1 -0.8
Cairns 130.5 139.7 9.2 -2.3 -7.1 -2.6 -6.5
Charters Towers 132.2 143.0 10.8 1.0 -3.8 -0.1 -4.0
Childers 127.3 139.7 12.4 -2.3 -7.1 -3.6 -7.5
Cloncurry 142.1 151.9 9.8 9.9 5.1 11.7 7.8
Dalby 130.7 141.9 11.2 -0.1 -4.9 -0.5 -4.4
Emerald 137.5 145.9 8.4 3.9 -0.9 8.0 4.1
Gladstone 126.4 137.0 10.6 -5.0 -9.8 -8.6 -12.5
Gold Coast 135.1 147.0 11.9 5.0 0.2 2.8 -1.1
Goondiwindi 126.2 138.9 12.7 -3.1 -7.9 -8.5 -12.4
Gympie 127.1 137.4 10.3 -4.6 -9.4 -5.7 -9.6
Hervey Bay 127.3 138.6 11.3 -3.4 -8.2 -5.1 -9.0
Ingham 128.9 135.9 7.0 -6.1 -10.9 -3.4 -7.3
Innisfail 130.7 141.7 11.0 -0.3 -5.1 -1.2 -5.1
Ipswich 137.9 151.0 13.1 9.0 4.2 4.6 0.7
Kingaroy 124.6 135.3 10.7 -6.7 -11.5 -8.0 -11.9
Longreach 136.6 147.5 10.9 5.5 0.7 7.3 3.4
Mackay 130.8 142.4 11.6 0.4 -4.4 -2.5 -6.4
Mareeba 131.6 143.1 11.5 1.1 -3.7 1.1 -2.8
Maryborough 124.5 133.6 9.1 -8.4 -13.2 -8.6 -12.5
Miles 126.2 130.7 4.5 -11.3 -16.1 -11.0 -14.9
Moranbah 125.5 136.5 11.0 -5.5 -10.3 -6.0 -9.9
Rockhampton 129.2 138.3 9.1 -3.7 -8.5 -4.6 -8.5
Roma 124.7 132.3 7.6 -9.7 -14.5 -5.5 -9.4
70 Report on the Australian petroleum market – June 2021
Location Mar 2021 Jun 2021
Change
Mar to Jun 2021
Differential Jun 2021
Differential 2020–21
5 largest cities
Capital city
5 largest cities
Capital city
Sunshine Coast 130.2 139.9 9.7 -2.1 -6.9 -2.5 -6.4
Toowoomba 136.9 143.8 6.9 1.8 -3.0 4.3 0.4
Townsville 128.9 140.7 11.8 -1.3 -6.1 -4.8 -8.7
Tully 129.7 140.4 10.7 -1.6 -6.4 -2.5 -6.4
Warwick 127.4 135.9 8.5 -6.1 -10.9 -3.4 -7.3
Whitsunday 123.7 134.8 11.1 -7.2 -12.0 -10.3 -14.2
Yeppoon 129.2 139.4 10.2 -2.6 -7.4 -2.9 -6.8
South Australia
Bordertown 127.5 137.6 10.1 -4.4 2.4 -4.1 0.0
Ceduna 129.8 141.1 11.3 -0.9 5.9 -1.9 2.2
Clare 125.3 137.3 12.0 -4.7 2.1 -7.2 -3.1
Gawler 126.2 136.2 10.0 -5.8 1.0 -3.2 0.9
Kadina 127.3 139.7 12.4 -2.3 4.5 -4.3 -0.2
Keith 129.1 138.1 9.0 -3.9 2.9 -3.3 0.8
Loxton 127.5 137.7 10.2 -4.3 2.5 -5.6 -1.5
Mt Gambier 123.2 132.9 9.7 -9.1 -2.3 -7.1 -3.0
Murray Bridge 121.2 131.5 10.3 -10.5 -3.7 -10.4 -6.3
Naracoorte 129.6 140.5 10.9 -1.5 5.3 -2.3 1.8
Port Augusta 128.2 140.1 11.9 -1.9 4.9 -2.5 1.6
Port Lincoln 131.7 143.5 11.8 1.5 8.3 -1.5 2.6
Port Pirie 126.1 136.5 10.4 -5.5 1.3 -5.8 -1.7
Renmark 129.5 141.1 11.6 -0.9 5.9 -2.8 1.3
Tailem Bend 127.4 136.1 8.7 -5.9 0.9 -4.7 -0.6
Victor Harbour 131.4 141.0 9.6 -1.0 5.8 -1.3 2.8
Whyalla 131.1 141.8 10.7 -0.2 6.6 -2.1 2.0
Tasmania
Burnie 132.3 143.4 11.1 1.4 -3.0 -0.4 -2.8
Campbell Town 135.3 147.0 11.7 5.0 0.6 3.7 1.3
Devonport 134.5 145.8 11.3 3.8 -0.6 3.7 1.3
Huonville 131.9 144.8 12.9 2.8 -1.6 0.9 -1.5
Launceston 132.8 144.3 11.5 2.3 -2.1 2.7 0.3
New Norfolk 134.7 147.4 12.7 5.4 1.0 3.8 1.4
Queenstown 138.3 149.1 10.8 7.1 2.7 6.4 4.0
Smithton 132.5 143.6 11.1 1.6 -2.8 0.1 -2.3
Sorell 129.9 138.9 9.0 -3.1 -7.5 -1.9 -4.3
Ulverstone 135.0 147.1 12.1 5.1 0.7 3.6 1.2
Wynyard 130.6 143.0 12.4 1.0 -3.4 0.4 -2.0
71 Report on the Australian petroleum market – June 2021
Location Mar 2021 Jun 2021
Change
Mar to Jun 2021
Differential Jun 2021
Differential 2020–21
5 largest cities
Capital city
5 largest cities
Capital city
Victoria
Ararat 130.3 141.5 11.2 -0.5 -3.0 -2.4 -5.8
Bairnsdale 127.1 136.5 9.4 -5.5 -8.0 -8.1 -11.5
Ballarat 126.5 134.5 8.0 -7.5 -10.0 -9.1 -12.5
Benalla 125.8 134.6 8.8 -7.4 -9.9 -6.7 -10.1
Bendigo 126.2 135.3 9.1 -6.7 -9.2 -7.5 -10.9
Cobram 129.3 140.4 11.1 -1.6 -4.1 -2.6 -6.0
Colac 128.0 141.1 13.1 -0.9 -3.4 -6.6 -10.0
Corryong 135.3 146.6 11.3 4.6 2.1 2.0 -1.4
Echuca 128.7 139.0 10.3 -3.0 -5.5 -4.8 -8.2
Euroa 130.9 142.6 11.7 0.6 -1.9 -1.3 -4.7
Geelong 125.8 131.7 5.9 -10.3 -12.8 -8.6 -12.0
Hamilton 125.1 134.5 9.4 -7.5 -10.0 -8.7 -12.1
Horsham 130.0 142.6 12.6 0.6 -1.9 -1.9 -5.3
Koo Wee Rup 140.4 147.0 6.6 5.0 2.5 7.1 3.7
Kyabram 128.5 138.2 9.7 -3.8 -6.3 -4.3 -7.7
Lakes Entrance 128.8 136.2 7.4 -5.8 -8.3 -6.9 -10.3
Leongatha 124.3 135.4 11.1 -6.6 -9.1 -7.9 -11.3
Mansfield 131.7 141.7 10.0 -0.3 -2.8 -1.6 -5.0
Mildura 124.2 134.6 10.4 -7.4 -9.9 -6.3 -9.7
Moe 126.4 135.7 9.3 -6.3 -8.8 -8.3 -11.7
Morwell 126.5 134.8 8.3 -7.2 -9.7 -8.7 -12.1
Portland 123.1 132.4 9.3 -9.6 -12.1 -8.7 -12.1
Sale 127.9 135.9 8.0 -6.1 -8.6 -4.8 -8.2
Seymour 138.0 144.9 6.9 2.9 0.4 4.5 1.1
Shepparton 128.4 137.5 9.1 -4.5 -7.0 -4.2 -7.6
Swan Hill 125.0 136.3 11.3 -5.7 -8.2 -6.0 -9.4
Traralgon 127.4 135.4 8.0 -6.6 -9.1 -7.2 -10.6
Wallan 137.1 146.1 9.0 4.1 1.6 2.9 -0.5
Wangaratta 128.9 139.6 10.7 -2.4 -4.9 -4.6 -8.0
Warrnambool 123.3 132.7 9.4 -9.3 -11.8 -10.8 -14.2
Wodonga 127.3 139.0 11.7 -3.0 -5.5 -3.8 -7.2
Wonthaggi 127.5 139.1 11.6 -2.9 -5.4 -4.2 -7.6
Yarrawonga 131.0 144.9 13.9 2.9 0.4 -0.9 -4.3
72 Report on the Australian petroleum market – June 2021
Location Mar 2021 Jun 2021
Change
Mar to Jun 2021
Differential Jun 2021
Differential 2020–21
5 largest cities
Capital city
5 largest cities
Capital city
Western Australia
Albany 126.2 137.3 11.1 -4.7 -2.6 -7.6 -4.6
Boulder 130.4 139.4 9.0 -2.6 -0.5 -1.4 1.6
Bridgetown 128.8 140.1 11.3 -1.9 0.2 -2.2 0.8
Broome 143.8 158.8 15.0 16.8 18.9 14.2 17.2
Bunbury 129.5 139.4 9.9 -2.6 -0.5 -3.6 -0.6
Busselton 127.6 136.4 8.8 -5.6 -3.5 -5.7 -2.7
Carnarvon 136.6 150.1 13.5 8.1 10.2 4.7 7.7
Collie 127.2 135.5 8.3 -6.5 -4.4 -8.1 -5.1
Dongara 133.5 144.5 11.0 2.5 4.6 3.2 6.2
Esperance 136.0 148.6 12.6 6.6 8.7 3.6 6.6
Eucla 151.7 161.9 10.2 19.9 22.0 18.6 21.6
Geraldton 131.2 141.5 10.3 -0.5 1.6 0.7 3.7
Kalgoorlie 129.5 138.8 9.3 -3.2 -1.1 -2.6 0.4
Karratha 144.4 157.0 12.6 15.0 17.1 14.8 17.8
Manjimup 129.2 139.6 10.4 -2.4 -0.3 -2.9 0.1
Mount Barker 126.1 138.7 12.6 -3.3 -1.2 -7.6 -4.6
Port Hedland 141.4 152.1 10.7 10.1 12.2 11.9 14.9
Waroona 127.1 141.5 14.4 -0.5 1.6 -3.9 -0.9
73 Report on the Australian petroleum market – June 2021
Appendix B: Update on regional market studiesThe ACCC undertook 4 regional petrol market studies between 2015 and 2017. These studies examined petrol markets in Darwin, Launceston, Armidale and Cairns. Following the completion of those studies, the ACCC continues to monitor prices and developments in these locations to assess changes in competition over time.
Retail prices in each location were relatively low compared with the 5 largest cities in the quarter and in 2020–21Table B1 shows average retail petrol prices and GIRDs for each market study location, and a comparison with those in the 5 largest cities, in the June quarter 2021 and in 2020–21.
Table B1: Quarterly and annual average retail petrol prices and GIRDs in Darwin, Launceston, Armidale, Cairns and the 5 largest cities – June quarter 2021 and 2020–21 – cpl
Darwin Launceston Armidale Cairns 5 largest cities
June quarter 2021 Retail prices
Average prices: June quarter 2021 139.9 144.3 137.3 139.7 142.0
Change from March quarter 2021 13.5 11.5 10.1 9.2 8.6
Difference from 5 largest cities: June quarter 2021
-2.1 2.3 -4.7 -2.3 -
Change from March quarter 2021 4.9 2.9 1.5 0.6 -
GIRDs
Average GIRDs: June quarter 2021 7.8 12.1 10.3 9.7 14.8
Change from March quarter 2021 3.7 1.6 1.1 -0.6 -1.0
Difference from 5 largest cities: June quarter 2021
-7.0 -2.7 -4.5 -5.1 -
Change from March quarter 2021 4.7 2.6 2.1 0.4 -
2020–21 Retail prices
Average prices: 2020–21 125.1 132.4 124.5 127.1 129.7
Change from 2019–20 -8.7 -16.2 -13.0 -9.6 -4.9
Difference from 5 largest cities: 2020–21 -4.6 2.7 -5.2 -2.6 -
Change from 2019–20 -3.8 -11.3 -8.1 -4.7 -
GIRDs
Average GIRDs: 2020–21 7.3 14.5 11.0 11.3 16.7
Change from 2019–20 -2.5 -8.7 -6.7 -1.6 2.0
Difference from 5 largest cities: 2020–21 -9.4 -2.2 -5.7 -5.4 -
Change from 2019–20 -4.5 -10.7 -8.7 -3.6 -
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil, Viva Energy and WA FuelWatch.
Notes: All prices are for RULP except Armidale (which is E10). Hobart TGPs are used as a proxy for TGPs in Launceston. Sydney and Brisbane E10 TGPs are used as a proxy for Armidale TGPs.
74 Report on the Australian petroleum market – June 2021
In the June quarter 2021:
� average retail prices in Darwin, Armidale and Cairns were lower than average prices in the 5 largest cities for the fourth consecutive quarter
� average retail prices in Launceston were marginally above prices in the 5 largest cities, after being lower in the previous quarter for the first time since the ACCC released its Launceston market study in July 2016
� average GIRDs in all of the market study locations were lower than GIRDs in the 5 largest cities.
In 2020–21, annual average prices in Darwin, Armidale and Cairns were lower than average prices in the 5 largest cities, while average prices in Launceston were marginally higher. Annual average GIRDs in all of the market study locations were lower than average GIRDs in the 5 largest cities.
Chart B1 shows the annual average differential between retail prices in Darwin, Launceston, Armidale and Cairns, and retail prices in the 5 largest capital cities over the last 4 years. It shows that over the 4 years, annual average prices in all 4 locations were at their lowest in 2020–21 when compared with prices in the 5 largest cities.
Chart B1: Annual average differential between retail petrol prices in each market study location and prices in the 5 largest cities: 2017-18 to 2020–21
-10
-5
0
5
10
15
20
Darwin Launceston Armidale Cairns
cpl
2017–18 2018–19 2019–20 2020–21
Source: ACCC calculations based on data from FUELtrac.
Note: A negative value means that average prices in the regional location were below average prices in the 5 largest cities.
DarwinThe ACCC released its report on the Darwin petrol market in November 2015.84 It found that the increase in retail petrol margins in Darwin in 2012–13 and 2013–14 had imposed a significant cost on motorists. The report noted that higher prices and profits in Darwin were the result of weak retail competition.
Darwin retail prices increased but remained below prices in the 5 largest cities Chart B2 shows quarterly average retail petrol prices in Darwin and the 5 largest cities over a 3–year period from the September quarter 2018 to the June quarter 2021.
84 ACCC, Report on the Darwin petrol market, 23 November 2015, at: https://www.accc.gov.au/publications/petrol-market-studies/report-on-the-darwin-petrol-market.
75 Report on the Australian petroleum market – June 2021
Chart B2: Quarterly average retail petrol prices in Darwin and the 5 largest cities: September quarter 2018 to June quarter 2021
100
110
120
130
140
150
160
170S
ep–1
8
Dec
–18
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
cpl
Darwin 5 largest cities
Source: ACCC calculations based on data from FUELtrac.
In the June quarter 2021, average retail prices in Darwin were 139.9 cpl, which was 2.1 cpl lower than average prices in the 5 largest cities. This was a decrease of 4.9 cpl from the differential in the March quarter 2021 (when the Darwin average price was 7.0 cpl lower than the 5 largest cities).
Compared with the March quarter 2021, Darwin’s prices increased by 13.5 cpl, which was larger than the increase in the 5 largest cities (8.6 cpl).
The ACCC’s market study found that the average differential between prices in Darwin and the 5 largest cities in 2012-13 and 2013-14 was over 19.0 cpl. Since then it has decreased significantly. Quarterly average prices in Darwin have been below those in the 5 largest cities in 9 out of the past 10 quarters.
In 2020–21, annual average retail prices in Darwin were 125.1 cpl, a decrease of 8.7 cpl from 2019–20 (133.8 cpl). Average prices in Darwin in 2020–21 were 4.6 cpl lower than prices in the 5 largest cities. This was an increase of 3.8 cpl in the annual differential between Darwin and the 5 largest cities from 2019–20, when annual average prices in Darwin were 0.8 cpl lower than prices in the 5 largest cities.
Darwin prices remained below a long-term competitive cost-based priceThe ACCC’s 2015 Darwin report noted that motorists were paying around 10.0 cpl more than they should have been in a competitive market. This was based on a comparison of GIRDs in Darwin with those in the larger capital cities.
Chart B3 shows Darwin petrol prices on a rolling annual average basis from 1 January 2015 to 30 June 2021. Analysis of prices over the long term enables short-term influences (such as lags in regional price movements) to be smoothed out.
The chart also shows estimated Darwin prices calculated on a long-term cost basis. This calculation reflects the fact that costs (such as freight and operating costs on a per litre basis) are higher in Darwin, and assumes that retail margins in Darwin should be broadly similar to long-term average retail margins in the 5 largest cities. This long-term competitive cost-based price provides a benchmark against which to compare current price levels. It is not static and will change as its underlying elements change over time. If retail prices are constantly above this benchmark price for a sustained period this may be indicative of a less-competitive market, in which retailers are earning higher margins at the expense of consumers.
76 Report on the Australian petroleum market – June 2021
Chart B3: Rolling annual average retail petrol prices and a long-term competitive cost-based price in Darwin, and the difference: 1 January 2015 to 30 June 2021
–10
0
10
20
30
40
50
60
70
100
110
120
130
140
150
160
170
180Ja
n–1
5
Ap
r–1
5
Jul–
15
Oct
–15
Jan
–16
Ap
r–1
6
Jul–
16
Oct
–16
Jan
–17
Ap
r–1
7
Jul–
17
Oct
–17
Jan
–18
Ap
r–1
8
Jul–
18
Oct
–18
Jan
–19
Ap
r–1
9
Jul–
19
Oct
–19
Jan
–20
Ap
r–2
0
Jul–
20
Oct
–20
Jan
–21
Ap
r–2
1
cpl
cpl
Di�erence (RHS)Retail prices (LHS) Competitive cost–based prices (LHS)
ACCC report released23 November 2015
ACCC announces Darwin market study 10 March 2015
Source: ACCC calculations based on data from FUELtrac, Informed Sources and the companies that participated in the Darwin market study.
Notes: A rolling annual average price is the average of that day’s price and prices on the previous 364 days.
A long-term competitive cost-based price assumes that retail margins in Darwin should be broadly similar to long-term average retail margins in the 5 largest cities.
The chart indicates that rolling annual average petrol prices in Darwin in the June quarter 2021 remained below a competitive cost-based price, as they have since mid-2019.
Possible factors contributing to the relatively low retail prices in Darwin over the last 2 years include:
� the change in price setter from Coles to Viva Energy at Coles Express retail sites in March 2019
� the opening of a second FuelXpress retail site in Palmerston in August 2019
� the opening of a new United retail site in Pinelands in December 2020.
Motorists in Darwin may have become more aware of these changes in pricing behaviour in the Darwin market through information available from the fuel price transparency scheme in the Northern Territory (MyFuel NT).
Darwin GIRDs increased but remained relatively low Chart B4 shows quarterly average GIRDs in Darwin and the 5 largest cities from the September quarter 2018 to the June quarter 2021. GIRDs in Darwin peaked at 30.6 cpl in the December quarter 2014, but have been relatively low in recent years.
77 Report on the Australian petroleum market – June 2021
Chart B4: Quarterly average GIRDs in Darwin and the 5 largest cities: September quarter 2018 to June quarter 2021
0
5
10
15
20
25
30S
ep–1
8
Dec
–18
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
cpl
Darwin 5 largest cities
Source: ACCC calculations based on data from FUELtrac, AIP, Ampol, bp, Mobil, Viva Energy and WA FuelWatch.
In the June quarter 2021, Darwin GIRDs were 7.8 cpl, an increase of 3.7 cpl from the March quarter 2021 (4.1 cpl). Darwin GIRDs in the June quarter 2021 were 7.0 cpl lower than GIRDs in the 5 largest cities (14.8 cpl). GIRDs in Darwin have been below those in the 5 largest cities in 9 out of the past 10 quarters.
In 2020–21, annual average GIRDs in Darwin were 7.3 cpl, a decrease of 2.5 cpl from 2019–20 (9.8 cpl). Darwin average GIRDs in 2020–21 were 9.4 cpl lower than GIRDs in the 5 largest cities (16.7 cpl).
Darwin motorists can find comprehensive real-time fuel prices on MyFuel NTMyFuel NT commenced on 1 November 2017. It is a territory-wide real-time mandatory retail fuel price reporting scheme, which gives consumers access (via website or mobile app) to live price data from every fuel retailer in the Northern Territory. MyFuel NT is similar to the FuelCheck schemes in New South Wales and Tasmania.
Motorists can use MyFuel NT to identify the highest and lowest priced retail sites in Darwin. For example, on 20 August 2021, it showed that there was a range of 2.4 cpl between the highest priced retail sites in Darwin (151.9 cpl at Coles Express, Woolworths and bp sites) and the lowest (149.5 cpl at a FuelXpress site).
LauncestonThe ACCC released its report on the Launceston petrol market in July 2016.85 It found that between 2012–13 and the first half of 2015–16, Launceston motorists paid on average around 12.0 cpl more for petrol than motorists in the 5 largest cities. The report noted that if the Launceston market was more competitive, motorists could expect savings of 4.0 cpl to 5.0 cpl on a sustainable basis. The 3 main factors causing higher prices in Launceston were higher transport costs, higher wholesale operating costs and margins, and higher retail operating costs and margins.
85 ACCC, Report on the Launceston petrol market, 20 July 2016, at: https://www.accc.gov.au/publications/petrol-market-studies/report-on-the-launceston-petrol-market.
78 Report on the Australian petroleum market – June 2021
Launceston retail prices increased and were marginally above prices in the 5 largest citiesChart B5 shows quarterly average retail petrol prices in Launceston and the 5 largest cities over a 3–year period from the September quarter 2018 to the June quarter 2021.
Chart B5: Quarterly average retail petrol prices in Launceston and the 5 largest cities: September quarter 2018 to June quarter 2021
100
110
120
130
140
150
160
170
Sep
–18
Dec
–18
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
cpl
Launceston 5 largest cities
Source: ACCC calculations based on data from FUELtrac.
In the June quarter 2021, average retail prices in Launceston were 144.3 cpl, which was 2.3 cpl higher than average prices in the 5 largest cities. This was an increase of 2.9 cpl from the differential in the March quarter 2021 (when average prices in Launceston were 0.6 cpl lower than the 5 largest cities).
Compared with the March quarter 2021, Launceston prices increased by 11.5 cpl in the quarter, which was larger than the increase in the 5 largest cities (8.6 cpl).
In 2020–21, annual average retail petrol prices in Launceston were 132.4 cpl, a decrease of 16.2 cpl from 2019–20 (148.6 cpl). The annual average differential between Launceston prices and prices in the 5 largest cities was 2.7 cpl in 2020–21, which was 11.3 cpl lower than in 2019–20 (14.0 cpl) and the lowest annual average differential that the ACCC has recorded.
Launceston prices were above a long-term competitive cost-based price but the difference decreasedChart B6 shows Launceston petrol prices on a rolling annual average basis and estimated Launceston prices calculated on a long-term competitive cost basis from 1 January 2015 to 30 June 2021. These prices have been calculated on the same basis as outlined for Darwin.
The chart shows that the gap between rolling annual average petrol prices and a long-term competitive cost-based price was generally larger after the market study, possibly reflecting the absence of vigorous and effective competition in Launceston. However, the gap decreased substantially in the first half of 2021.
79 Report on the Australian petroleum market – June 2021
Chart B6: Rolling annual average retail petrol prices and a long-term competitive cost-based price in Launceston, and the difference: 1 January 2015 to 30 June 2021
Di�erence (RHS)Retail prices (LHS) Competitive cost–based prices (LHS)
-10
0
10
20
30
40
50
60
70
100
110
120
130
140
150
160
170
180Ja
n–1
5
Ap
r–1
5
Jul–
15
Oct
–15
Jan
–16
Ap
r–1
6
Jul–
16
Oct
–16
Jan
–17
Ap
r–1
7
Jul–
17
Oct
–17
Jan
–18
Ap
r–1
8
Jul–
18
Oct
–18
Jan
–19
Ap
r–1
9
Jul–
19
Oct
–19
Jan
–20
Ap
r–2
0
Jul–
20
Oct
–20
Jan
–21
Ap
r–2
1
cpl
cpl
ACCC report released20 July 2016
ACCC announces Launceston market study 10 May 2015
Source: ACCC calculations based on data from FUELtrac, Informed Sources and the companies that participated in the Launceston market study.
Notes: A rolling annual average price is the average of that day’s price and prices on the previous 364 days.
A long-term competitive cost-based price assumes that retail margins in Launceston should be broadly similar to long-term average retail margins in the 5 largest cities.
Launceston GIRDs increased but remained below GIRDs in the 5 largest cities Chart B7 shows quarterly average GIRDs in Launceston and the 5 largest cities from the September quarter 2018 to the June quarter 2021.
Chart B7: Quarterly average GIRDs in Launceston and the 5 largest cities: September quarter 2018 to June quarter 2021
0
5
10
15
20
25
30
Sep
–18
Dec
–18
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
cpl
Launceston 5 largest cities
Source: ACCC calculations based on data from FUELtrac, AIP, Ampol, bp, Mobil, Viva Energy and WA FuelWatch.
Note: Hobart TGPs are used as a proxy for TGPs in Launceston.
80 Report on the Australian petroleum market – June 2021
In the June quarter 2021, Launceston GIRDs were 12.1 cpl, an increase of 1.6 cpl from the March quarter 2021 (10.5 cpl) which was the lowest quarterly average GIRDs in Launceston over the 3–year period. Launceston GIRDs in the June quarter 2021 were 2.7 cpl lower than GIRDs in the 5 largest cities (14.8 cpl). This was the fourth consecutive quarter when GIRDs in Launceston were below GIRDs in the 5 largest cities.
In 2020–21, annual average GIRDs in Launceston were 14.5 cpl, a decrease of 8.7 cpl from 2019–20 (23.2 cpl). Launceston annual average GIRDs in 2020–21 were 2.2 cpl lower than GIRDs in the 5 largest cities (16.7 cpl).
Launceston motorists can find comprehensive real-time fuel prices on FuelCheck TASOn 18 September 2020, the Tasmanian Government commenced its fuel price transparency scheme – FuelCheck TAS – based on the FuelCheck scheme in New South Wales. Motorists can use it to identify the highest and lowest priced retail sites in Launceston. For example, on 20 August 2021, it showed that there was an 11.0 cpl range between the highest priced retail site in Launceston (159.9 cpl at bp Youngtown) and the lowest priced sites (148.9 cpl at a Coles Express site and an independent site, Tas Petroleum Launceston).
ArmidaleThe ACCC released its report on the Armidale petrol market in November 2016.86 It found that relatively weak retail competition in Armidale, reflected by a lack of price discounting, contributed to E10 prices in Armidale being on average 8.0 cpl higher than RULP prices in the 5 largest cities between 2012–13 and 2014–15.
Armidale retail prices increased but remained below prices in the 5 largest cities Chart B8 shows quarterly average retail petrol prices in Armidale and the 5 largest cities over a 3–year period from the September quarter 2018 to the June quarter 2021.
Chart B8: Quarterly average retail petrol prices in Armidale and the 5 largest cities: September quarter 2018 to June quarter 2021
100
110
120
130
140
150
160
170
Sep
–18
Dec
–18
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
cpl
Armidale 5 largest cities
Source: ACCC calculations based on data from FUELtrac.
86 ACCC, Report on the Armidale petrol market, 21 November 2016, at: https://www.accc.gov.au/publications/petrol-market-studies/report-on-the-armidale-petrol-market. References to petrol prices in Armidale in this appendix are to E10 prices. Armidale prices in appendix A are RULP prices.
81 Report on the Australian petroleum market – June 2021
In the June quarter 2021, average retail prices in Armidale were 137.3 cpl, which was 4.7 cpl lower than average prices in the 5 largest cities. This was a decrease of 1.5 cpl from the differential in the March quarter 2021 (when average prices in Armidale were 6.2 cpl lower than prices in the 5 largest cities).
Compared with the March quarter 2021, Armidale prices increased by 10.1 cpl, which was larger than the increase in the 5 largest cities (8.6 cpl).
In 2020–21, annual average retail petrol prices in Armidale were 124.5 cpl, a decrease of 13.0 cpl from 2019–20 (137.5 cpl). Average prices in Armidale in 2020–21 were 5.2 cpl lower than prices in the 5 largest cities. This was a decrease of 8.1 cpl in the annual differential between Armidale and the 5 largest cities from 2019–20, when annual average prices in Armidale were 2.9 cpl higher than prices in the 5 largest cities.
Armidale prices moved below a long-term competitive cost-based price Chart B9 shows Armidale petrol prices on a rolling annual average basis and estimated Armidale prices calculated on a long-term competitive cost basis from 1 January 2015 to 30 June 2021. These prices have been calculated on the same basis as outlined for Darwin.
The chart indicates that rolling annual average petrol prices in Armidale moved below a rolling long-term competitive cost-based price in the June quarter 2021.
Chart B9: Rolling annual average retail prices and a long-term competitive cost-based price in Armidale, and the difference: 1 January 2015 to 30 June 2021
Di�erence (RHS)Retail prices (LHS) Competitive cost–based prices (LHS)
-10
0
10
20
30
40
50
60
70
100
110
120
130
140
150
160
170
180
Jan
–15
Ap
r–1
5
Jul–
15
Oct
–15
Jan
–16
Ap
r–1
6
Jul–
16
Oct
–16
Jan
–17
Ap
r–1
7
Jul–
17
Oct
–17
Jan
–18
Ap
r–1
8
Jul–
18
Oct
–18
Jan
–19
Ap
r–1
9
Jul–
19
Oct
–19
Jan
–20
Ap
r–2
0
Jul–
20
Oct
–20
Jan
–21
Ap
r–2
1
cpl
cpl
ACCC report released 21 November 2016
ACCC announces Armidale market study 3 August 2015
Source: ACCC calculations based on data from, FUELtrac, Informed Sources and the companies that participated in the Armidale market study.
Notes: A rolling annual average price is the average of that day’s price and prices on the previous 364 days.
A long-term competitive cost-based price assumes that retail margins in Armidale should be broadly similar to long-term average retail margins in the 5 largest cities.
Armidale GIRDs increased but remained below GIRDs in the 5 largest cities Chart B10 shows quarterly average GIRDs in Armidale and the 5 largest cities from the September quarter 2018 to the June quarter 2021.
82 Report on the Australian petroleum market – June 2021
Chart B10: Quarterly average GIRDs in Armidale and the 5 largest cities: September quarter 2018 to June quarter 2021
0
5
10
15
20
25
30S
ep–1
8
Dec
–18
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
cpl
Armidale 5 largest cities
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil, Viva Energy and WA FuelWatch data.
Note: Sydney and Brisbane E10 TGPs from monitored companies are used as a proxy for Armidale TGPs.
In the June quarter 2021, average GIRDs in Armidale were 10.3 cpl, an increase of 1.1 cpl from the March quarter 2021 (9.2 cpl). Armidale GIRDs in the June quarter 2021 were 4.5 cpl lower than GIRDs in the 5 largest cities (14.8 cpl). This was the fourth consecutive quarter when GIRDs in Armidale were below GIRDs in the 5 largest cities.
In 2020–21, annual average GIRDs in Armidale were 11.0 cpl, a decrease of 6.7 cpl from 2019–20 (17.7 cpl). Armidale annual average GIRDs in 2020–21 were 5.7 cpl lower than GIRDs in the 5 largest cities (16.7 cpl).
Armidale motorists can find comprehensive real-time fuel prices on FuelCheck NSWMotorists in Armidale can use the FuelCheck NSW website and app to identify the highest and lowest priced retail sites in Armidale. For example, on 20 August 2021, the FuelCheck NSW website showed that there was a 6.9 cpl range between the highest priced RULP retail site in Armidale (152.9 cpl at Caltex Armidale) and the lowest (146.0 cpl at Beardy Street Servo). There was an 8.0 cpl range between the highest priced E10 retail site (153.9 cpl at Caltex Armidale) and the lowest priced sites (145.9 cpl at Lowes Armidale, Woolworths Armidale and Coles Express Armidale).
CairnsThe ACCC released its report on the Cairns petrol market in May 2017.87 It found that between 2012–13 and the first half of 2016–17, the average differential between prices in Cairns and the 5 largest cities was around 11.0 cpl. It concluded that a lack of vigorous and effective retail price competition in Cairns contributed to the increase in retail margins and profits.
Cairns retail prices increased but remained below prices in the 5 largest cities Chart B11 shows quarterly average retail petrol prices in Cairns and the 5 largest cities over a 3-year period from the September quarter 2018 to the June quarter 2021.
87 ACCC, Report on the Cairns petrol market, 29 May 2017, at: https://www.accc.gov.au/publications/petrol-market-studies/report-on-the-cairns-petrol-market.
83 Report on the Australian petroleum market – June 2021
Chart B11: Quarterly average retail petrol prices in Cairns and the 5 largest cities: September quarter 2018 to June quarter 2021
100
110
120
130
140
150
160
170S
ep–1
8
Dec
–18
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
cpl
Cairns 5 largest cities
Source: ACCC calculations based on data from FUELtrac.
In the June quarter 2021, average retail prices in Cairns were 139.7 cpl, which was 2.3 cpl lower than average prices in the 5 largest cities. This was a decrease of 0.6 cpl from the differential in the March quarter 2021 (when average prices in Cairns were 2.9 cpl lower than prices in the 5 largest cities).
Compared with the March quarter 2021, Cairns prices increased by 9.2 cpl, which was larger than the increase in the 5 largest cities (8.6 cpl).
In 2020–21, annual average retail prices in Cairns were 127.1 cpl, a decrease of 9.6 cpl from 2019–20 (136.7 cpl). Average prices in Cairns in 2020–21 were 2.6 cpl lower than prices in the 5 largest cities. This was a decrease of 4.7 cpl in the annual differential between Cairns and the 5 largest cities from 2019–20, when annual average prices in Cairns were 2.1 cpl higher than prices in the 5 largest cities.
Cairns prices were marginally above a long-term competitive cost-based price Chart B12 shows Cairns petrol prices on a rolling annual average basis and estimated Cairns prices calculated on a long-term competitive cost basis from 1 January 2015 to 30 June 2021. These prices have been calculated on the same basis as outlined for Darwin.
The chart indicates that for most of the June quarter 2021, rolling annual average petrol prices were only marginally above a rolling long-term competitive cost-based price.
84 Report on the Australian petroleum market – June 2021
Chart B12: Rolling annual average retail prices and a long-term competitive cost-based price in Cairns, and the difference: 1 January 2015 to 30 June 2021
Di�erence (RHS)Retail prices (LHS) Competitive cost–based prices (LHS)
-10
0
10
20
30
40
50
60
70
100
110
120
130
140
150
160
170
180Ja
n–1
5
Ap
r–1
5
Jul–
15
Oct
–15
Jan
–16
Ap
r–1
6
Jul–
16
Oct
–16
Jan
–17
Ap
r–1
7
Jul–
17
Oct
–17
Jan
–18
Ap
r–1
8
Jul–
18
Oct
–18
Jan
–19
Ap
r–1
9
Jul–
19
Oct
–19
Jan
–20
Ap
r–2
0
Jul–
20
Oct
–20
Jan
–21
Ap
r–2
1
cpl
cpl
ACCC report released 30 May 2017
ACCC announces Cairns market study 19 April 2016
Source: ACCC calculations based on data from FUELtrac, Informed Sources and the companies that participated in the Cairns market study.
Notes: A rolling annual average price is the average of that day’s price and prices on the previous 364 days.
A long-term competitive cost-based price assumes that retail margins in Cairns should be broadly similar to long-term average retail margins in the 5 largest cities.
Cairns GIRDs decreased and remained below GIRDs in the 5 largest cities Chart B13 shows quarterly average GIRDs in Cairns and the 5 largest cities from the September quarter 2018 to the June quarter 2021.
Chart B13: Quarterly average GIRDs in Cairns and the 5 largest cities: September quarter 2018 to June quarter 2021
0
5
10
15
20
25
30
Sep
–18
Dec
–18
Mar
–19
Jun
–19
Sep
–19
Dec
–19
Mar
–20
Jun
–20
Sep
–20
Dec
–20
Mar
–21
Jun
–21
cpl
Cairns 5 largest cities
Source: ACCC calculations based on data from FUELtrac, Ampol, bp, Mobil, Viva Energy and FuelWatch.
85 Report on the Australian petroleum market – June 2021
In the June quarter 2021, average GIRDs in Cairns were 9.7 cpl, a decrease of 0.6 cpl from the March quarter 2021 (10.3 cpl). Cairns GIRDs in the June quarter 2021 were 5.1 cpl lower than GIRDs in the 5 largest cities (14.8 cpl). This was the fourth consecutive quarter when GIRDs in Cairns were below GIRDs in the 5 largest cities.
In 2020–21, annual average GIRDs in Cairns were 11.3 cpl, a decrease of 1.6 cpl from 2019–20 (12.9 cpl). Cairns annual average GIRDs in 2020–21 were 5.4 cpl lower than GIRDs in the 5 largest cities (16.7 cpl).
Cairns motorists can find comprehensive real-time fuel prices on apps and websites The Queensland Government commenced a 2-year trial of its fuel price reporting scheme on 3 December 2018. The scheme required all Queensland fuel retailers to report their undiscounted fuel prices to a data aggregator, and gave consumers access to the price data via apps and websites. In December 2020, the Queensland Government announced that the fuel scheme would be permanent.
Motorists in Cairns are able to access site-specific petrol price data made available by websites and app providers under the Queensland fuel price reporting scheme to identify the highest and lowest priced retail sites in Cairns. For example, on 20 August 2021, using the PetrolSpy website, there was a 6.0 cpl range between the highest priced retail sites in Cairns (153.9 cpl at Shell Cairns Truckstop and Mobil Brinsmead) and the lowest priced sites (147.9 cpl at Liberty Woree and United sites).
