7th March, 2016 · Regulation

Call for new laws as petrol prices
finally fall

2 minutes to read

Two Australian senators have called for new laws to protect drivers from being ripped off at the bowser as crude oil prices fell to their lowest level in 13 years.
Senator Ricky Muir of the Australian Motoring Enthusiast Party said the Federal Government should review current legislation and consider stronger powers for the Australian Competition and Consumer Commission to investigate and punish price gougers.

“It is no secret than when the price of a barrel of fuel goes up, the cost to the consumer seems to be passed on even before the next delivery of fuel arrives,” he said.

“Sadly, there always seems to be some excuse as to why the same does not happen when the price of a barrel drops.”

Crude oil prices have slumped 20 percent this year to about $US28 a barrel. It is the first time since 2003 that crude oil has fallen below $US30 a barrel. Eight months ago prices were hovering around the $US65 mark.

Australian petrol prices did not initially drop in line with crude oil prices. Despite a 70

percent drop in the price of crude oil over 18 months, Australian petrol prices were down just 20 percent in the same time.

Once Senator Muir’s comments hit the media, petrol prices fell from around $1.20 to just over $1 a litre, with prices even falling below $1 per litre at some service stations in Sydney and Adelaide. However, they soon rose again, almost back to the $1.20 mark.

The ACCC was also concerned savings weren’t being passed on, and held informal meetings with major petrol retailers. Prices fell soon afterwards.

Victorian Senator, John Madigan, backed Senator Muir, calling for an “open, transparent, competitive and fair” pricing system.

He said regional and rural motorists – often those who could least afford it – were hardest hit.

“Petrol is an essential product and rorting by anyone in the supply chain is unacceptable,” he said.

AADA supports the Senators and the AADA in their efforts to make petrol more affordable for Australian motorists.