Australian motorists benefit from a decrease in petrol prices

28 November 2016

The Australian Competition and Consumer Commission’s eighth report into the Australian petroleum industry has revealed a decrease in petrol prices in the quarter ending September 2016.

Petrol prices in the five largest cities (i.e. Sydney, Melbourne, Brisbane, Adelaide, and Perth) decreased by 3.8 cents per litre (cpl) in the September quarter 2016 to 114.2 cpl. This is lower than the 118.0 cpl of the previous quarter and was 7.5 cpl lower than the annual average of 121.7 cpl in 2015-16.

The international refiner margin (ie the difference between the price of refined petrol and the price of crude oil) is now close to the annual average refiner margin of USD 8 per barrel over the last 20 years.

“International factors continue to strongly influence the price at the bowser. A drop in refiner margins in the last quarter has helped to push prices down locally,” ACCC Chairman Rod Sims said.

“Australian motorists have benefited as prices have fallen, which will be especially welcome as we move into the busy holiday period.”

In the September quarter 2016, taxes represented around 44 per cent of the retail price of petrol in Australia. This is much lower than in other developed countries.

“A global comparison has also shown that Australian prices have remained extremely competitive by international standards as a result of the relatively low rate of taxation on fuel,” Mr Sims said.

“Despite these lower prices our message to all motorists is: continue to shop around and reward those retailers offering the best-priced fuel. This will help you, and also bring more competitive tension to the market.”

“Improved price transparency from initiatives such as FuelCheck, an online tool with real-time prices for almost every retail site across NSW which commenced in August 2016, as well as existing apps (such as Motormouth, GasBuddy, and those of the petrol retailers), is giving motorists the ability to easily compare prices and get the best deal.”

Other findings in the report

Ethanol mandate

As a result of the ethanol mandate, motorists in Sydney have purchased significantly higher volumes of premium unleaded petrol (54% of total petrol sales in 2014-15) and E10, and much lower volumes of regular unleaded petrol, than motorists in other states (where premium fuel was 23% of total petrol sales in 2014-15).

Sydney motorists may have spent around $75 million to $85 million more on petrol in 2014-15 (representing 3.1 cpl to 3.6 cpl across all petrol sold in Sydney) due to the ethanol mandate.

“While the use of E10 may be better for the environment, the ethanol mandate has reduced consumer choice and cost Sydney motorists up to $85 million. It has also boosted Sydney retailer’s profits due to the higher margins on premium fuel,” Mr Sims said.


In the September quarter 2016 average retail prices in Brisbane were 115.2 cpl, 1.3 cpl higher than the other four largest cities. This is the smallest quarterly price differential since the cessation of the Queensland Government retail fuel subsidy scheme on 30 June 2009.

“Although prices remain higher than other cities, and this must annoy Brisbane motorists, they are facing the lowest price difference with the four other largest cities since 2009,” Mr Sims said.


Petrol prices in Darwin have been historically low since the release of the ACCC report into the Darwin petrol market. In the September quarter 2016 prices in Darwin were only 1.7 cpl higher than those in the five largest cities.

Retailer margins

Average gross retail margins (i.e. the difference between average retail prices and average wholesale prices) in the five largest cities in the September quarter 2016 were 10.4 cpl, a decrease of 0.6 cpl from the previous quarter. As they do not include costs, gross retail margins should not be confused with actual retail profits. Margins in the quarter were 3 cpl higher than the average over the past 14 years in real terms (7.4 cpl).

Annual average GIRDs in the five largest cities increased by 2.6 cpl in 2015-16. Higher regulatory costs in NSW and Queensland, and other costs, may have contributed in the region of around 1 cpl to the increase in GIRDs in the last year.

See: Report on the Australian petroleum industry—September quarter 2016


In December 2014 the Australian Government directed the ACCC to monitor the prices, costs, and profits of unleaded petroleum products in Australia for a period of three years.

The ACCC collects retail petrol prices for all capital cities and over 190 regional locations across Australia.


Release number: 
MR 220/16
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