Relief in sight for motorists trying to save on petrol
PETROL retailers have been gouging large profits of 25 cents per litre or more from motorists as prices for crude oil plummeted to their lowest level in 11 years this week.
However, there is some Christmas holiday relief in sight, with prices set to drop across the Northern Rivers, but the profit margins of major retailers may limit the savings to motorists.
Brent crude oil prices fell to their lowest prices since July 2004 in London futures trading on Monday, and west Texas crude oil closed at $34.50 US a barrel.
An analysis by CommSec found Singapore fuel prices had fallen about 15 cents a litre since early October, but Australian wholesale prices were only down 12 cents.
Despite Australian wholesale prices falling 12 cents over that period, the retail pump price is less than 10 cents lower - even though Australia imports most of its fuel from Singapore refineries.
It's not just unleaded petrol users feeling the pinch at the bowser, with wholesale diesel prices also falling to an 11-year low of below $1 per litre, but motorists are still paying an average of $1.25 per litre.
NRMA spokesman Peter Khoury said prices would fall across the Northern Rivers but a lack of competition compared to cities meant falls wouldn't be as significant as the $1.10 per litre predicted in Sydney.
He said competition from independent retailers in Sydney caused greater fluctuations in price compared to the Northern Rivers.
"The average price in Lismore was $1.24 cents per litre on Monday and Casino was $1.16, making it cheaper than Sydney," he said.
"We would certainly expect the prices for other regional towns around the Northern Rivers to fall but I don't know if Casino has much room to drop.
"We know that the profit margins of the oil companies have been the highest on record, particularly in the three-month period ending September 30.
"We know the major retailers have been making 25 cents per litre or more profit on fuel."
Mr Khoury said the price drop for diesel wouldn't be as significant, despite the record low wholesale price.
"Diesel pricing structure is different to unleaded and other fuels and the demand for diesel in Australia isn't as high," he said.
"Because there is less demand there is less competition, so you are less inclined to see prices move the way they do with petrol."
The Australian Competition and Consumer Commission said a combination of factors caused fuel prices to rise and fall, including changes in international benchmark prices, the value of the Australian dollar, levels of competition in different areas and pricing decisions by wholesalers and retailers.