Woolworths' plan to move into petrol sales has been hailed by the Australian Competition and Consumer Commission as 'pro-competitive'.

"The move would see greater choice for consumers about where they buy their fuel and should lead to lower prices," ACCC Chairman, Professor Allan Fels, said today.

"It is a move which was recently sounded out with the ACCC," Professor Fels said. "The ACCC had no objections and, in fact, sees the move as opening up the petrol market.

"The plan would follow an overseas trend where consumers can ready buy essentials - food and fuel - in a one-stop environment. The move could be of special significance in country areas where competition is often weak.

"The ACCC notes that Woolworths plans to launch one of its first such operations in Dubbo and a significant number of other NSW country towns.

"The ACCC re-iterates an important conclusion of its recent report: it is very important that local councils do not hinder such important developments by refusing planning approvals.

"In the United Kingdom supermarkets have led petrol prices down by significant amounts and major oil companies have been forced to respond.

"It is the sort of change in the petrol environment forecast by the ACCC in its recent report on the declaration of petrol prices which should see the lifting of price controls during 1997," he said.

"The ACCC notes that Woolworths will receive it supplies of petrol from imported sources. This augurs well for competition."