Brisbane petrol prices have hit local highs for the fourth day in a row and remained the most expensive in the nation amid a global oil shortage and a lack of competition.
City motorists paid an average of $1.55 per litre for unleaded on Wednesday, according to the Motormouth website. It was the fourth straight day that Brisbane prices were at a three-year high.
The price surge began on April 18 when average prices rose to $1.37. By April 21 they were at $1.50 and kept climbing to hit a new high on Anzac Day.
As usual, Brisbane’s prices were the highest in the nation. Melbourne drivers were paying $1.51 on Wednesday, while Sydney, Darwin and Perth drivers were paying $1.50.
Petrol prices in Brisbane appear to operate on a 30- to 40-day cycle, according to consumer watchdog the ACCC, which means relief might be in sight.
Why the price surge?
Global oil prices have surged to just under $US70 a barrel, up from $US63 at the start of April, seemingly because of a drop in global supply.
OPEC, a group of 25 oil-producing nations, struck a deal in December 2016 to curb production in order to inflate the oil price. Up to that point OPEC members had been overproducing in a failed attempt to put US shale oil producers out of business.
However, according to The New Daily economics commentator Rob Burgess, Australian retailers might also be taking advantage of the news to boost profits.
“What appears to be happening is that some retailers are using news of rising oil prices as cover to get their average profit margin up a bit –making hay while the sun shines,” he wrote this week.
Why is Brisbane the worst affected city?
In 2017, the ACCC concluded that a lack of competition and a dearth of independent retailers in Brisbane allowed large chains to charge motorists more than in Sydney, Melbourne, Adelaide and Perth.
Brisbane motorists paid an extra $50 million a year for petrol because of this lack of competition, the watchdog estimated in its October report.
“The ACCC’s report confirms Brisbane drivers’ suspicions that they are paying too much for petrol, and that some local fuel retailers are enjoying high profit margins at their expense,” ACCC Chairman Rod Sims said at the time.
“Independent chains can be competitive price setters in large metropolitan markets, and their absence means that prices are otherwise higher.”
7-Eleven, Puma Energy, Freedom Fuels and United were the only independent chains in Brisbane, the ACCC found.
RACQ has in the past urged drivers to boycott big firms like Coles and BP and buy from cheaper independent stations whenever possible.