ACCC Fuel Watchdog

Submitted: Friday, Jan 23, 2009 at 16:02
ThreadID: 65363 Views:3892 Replies:8 FollowUps:8
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I recall reading on this site yesterday in the news section of the forum that the fuel watchdog was going to be looking very closely at fuel companies to ensure they didn't try to profiteer over the Australia Day long weekend.

Just came past a Shell S/S and surprise surprise, the price of ULP is currently at 119.5 c/pl

Now I thought to myself.......the barrel price must have spiked......no, its still down around US$34 a barrel...........then I thought perhaps the bottom has fallen out of the A dollar...........no.........its still around US0.68. I thought noooooo.......it wouldn't be the fuel companies trying to hike the prices up just before the Australia Day long weekend surely. I mean.....it was sitting at 96.5 only on Tuesday so something must have happened because the fuel companies wouldn't be so brazen to take on that fearsome fuel watchdog would they.

One day our politicians will sit up and listen to what the public have been telling them for years.

Sadly, it probably wont be in my lifetime.

Have a great Australia Day everyone.
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Reply By: Sir Kev & Darkie - Friday, Jan 23, 2009 at 16:12

Friday, Jan 23, 2009 at 16:12
Paul,

Just to make your day

Diesel here in Calliope QLD is $1.179/L

ULP is $1.049/L


Cheers Kev
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Follow Up By: Member - Paul Mac (VIC) - Friday, Jan 23, 2009 at 16:17

Friday, Jan 23, 2009 at 16:17
Good on ya Kev.......lol

I'm hoping mate that by tomorrow the price will fall back to something a little more respectable so I can fill up and go away.

I didn't look at the diesel price Kev but would imagine it being over the $1.30 mark.

I did see the LPG price as 37 cents and thought geeee, that's a good price.

Um, Kev..........your not coming down for the Pyranees gathering on Monday I see. Not worth it for one day huh?.......just kidding mate.

Cheers and have a good one.
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Follow Up By: Sir Kev & Darkie - Friday, Jan 23, 2009 at 16:24

Friday, Jan 23, 2009 at 16:24
I put in a reply of I wish for the Pair of Knees trip haha

I also had to can the Nthn NSW trip as well, eldest kids 1st day at school on Tuesday and 1000km trip home on Monday didn't impress SWMBO

I am set for the 3 day trip to the Pair of Knees again later this year maybe a few more will tag along this year.


The St G gathering is also up to 47 potential attendee's so it should be an interesting gathering this year to meet a few more new faces.

I hope David and Michelle hurry up and work out when the 2010 Major Gathering will be so I can plan for it ;)) It has been a while since I have been to WA and the rest of the family have never been there, so they are keen to go to that one.

Cheers Kev
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Follow Up By: Angler - Friday, Jan 23, 2009 at 21:50

Friday, Jan 23, 2009 at 21:50
Isn't it a pity pollies never have to pay for fuel. If they did and they could read maybe something would get done.

Pooley

went up about 10c here in Townsville
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Reply By: gbdid - Friday, Jan 23, 2009 at 16:53

Friday, Jan 23, 2009 at 16:53
I think I heard on the news a few nights back that although the price of oil is lower, the benchmark price for petrol, ie the Singapore price for petrol has gone up.

Have a look at this site for some information on the fuel prices.
It shows the price of petrol above the price of diesel , something that I think has not happened for quite some time.

http://www.aip.com.au/pricing/marketwatch.htm
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Reply By: The Landy - Friday, Jan 23, 2009 at 17:36

Friday, Jan 23, 2009 at 17:36
Paul, with all due respect to you and your viewpoint, I want to note a couple of points.

The Terminal Gate Price (TGP) for ULP on Tuesday in Melbourne was 104.53 cents per litre, so if you were buying it for 96.5 cents per litre you should be pleased, because it was below the wholesale price; that is the price that retailers pay for it (and replacement cost). In fact the TGP has averaged 105.47 cents per litre in Melbourne this week.

The fact you were buying it below the wholesale cost is probably as a consequence of the discounting cycle.

Today’s TGP in Melbourne is 109.8 cents per litre, so at 119.5 cents per litre this represents approximately a 10 cent difference. Take into account the cost of freight and insurance from the terminal to the retailer, add in a retailer margin and the price looks reasonable. After all, the retailers, who are mostly businesses operated independently of the major fuel companies (despite external branding), should be entitled to ‘earn a living’ otherwise the would probably close up shop

It is also worth noting that the spread between ULP and diesel has closed considerably; one of the reasons it has been wider in recent times has been the heavy discounting of ULP and I discussed this in a recent in a blog.

Another point worth making is you can’t look at the price of a barrel of oil on any given day and translate its movements into expected movements for refined products on that day. There are many influences that dictate the movement of both, and independently of each other.

The Australian dollar is trading at 0.6500 cents presently, and its average opening price in Australia this week has been 0.6620 cents, nowhere near 0.6800 cents.

You can goad politicians and the ACCC into acting, but on what? There does not appear to be anything untoward about the pricing today or this week. The problem about complaining to politicians’ about something they can’t fix or have any control over means they will try and placate the masses by the introduction of superficial (and inappropriate) remedies. FuelWatch is a great example of this. Under FuelWatch you probably would not have had the opportunity to purchase fuel as cheap as the price you describe this week.

In fact, about the only thing any government in Australia can do to provide relief on fuel prices is to change the taxes and excises they impose. But that would open discussions on how it would be funded.

I’m not here to defend the fuel companies, they’re big enough to do it themselves; but it is important to get the facts and arguments right if taking a shot at either the, Government, ACCC, or the fuel companies otherwise the arguments will be dismissed by these groups as mere uniformed ranting rather than informed discussion.

Off my soapbox….but I’m like a dog with a bone when it comes to discussing fuel prices….

Cheers, and enjoy the long weekend………
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Follow Up By: Bytemrk - Friday, Jan 23, 2009 at 22:53

Friday, Jan 23, 2009 at 22:53
There is no question that 10c per litre between TGP and retail is quite fair, particularly when you take into account all the factors you mention.

I also agree many of the independent operators get a bad rap.. when it's not always justified.

But who sets the terminal gate price?.... The Oil companies....that's right the profiteering happens before that price is set.

It's getting a bit hot to make big profits at the retail level... so you bury it further back in the process, quite simple really.


I agree people can't compare same day moves in Singapore Tapis pricing either, But it is currently selling at prices similar to early 2004! - I don't remember my diesel costing over $1.20 a litre back then.. Yes costs have gone up... but not enough to justify what goes on today.

There is no possible justification for the prices we are currently paying.

The big oil companies continue to shaft us all.. and we don't have much choice but to line up and bend over @@..

Mark
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Follow Up By: The Landy - Monday, Jan 26, 2009 at 09:02

Monday, Jan 26, 2009 at 09:02
Hi Mark

The TGP is set with reference to some very transparent price inputs. Any discrepancy or deviation from the 'norm' would be very visible and contestable.

Many talk about being 'shafted' by the fuel companies. But ask yourself, who is doing the real 'shafting'? Refiners have invested significant amounts of capital (billions) so we can conveniently pull up at any service station and fuel our vehicles. The industry is a significant employer and generates taxable income for the Australian Government. For that they earn around 1 cent per litre of fuel refined. Less than 1% based on the current price.

In significant contrast, the Australian Government is paid just over 38 cents in excises and has a GST on retail fuel purchases. Based on the excise alone this represents around 38% of the current price of fuel. And remember, the excise is a ‘fixed’ amount so if, and when fuel prices fall the actual percentage that it rakes from your wallet increases.

So who is the real villain here? .....mind you if the Government did drop taxes on fuel they would need to raise the money somewhere else. As was noted by Footloose elsewhere in this thread, we’d all do better to make the government account for the way it spends the money it generates from the fuel excise, rather than wasting time criticising fuel companies for wanting a (meager) return on their investment.

I’ve said before the greater risk to fuel retailing in Australia is supply, not price, if the refiners don’t generate a return sufficient to support the business then they will leave. You only need to look at Port Stanvac in South Australia as an example….

Take care, and enjoy the rest of the weekend.

The Landy
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Follow Up By: Bytemrk - Monday, Jan 26, 2009 at 20:49

Monday, Jan 26, 2009 at 20:49
Hi Landy,

I guess you are right, it's easy to get caught up in the emotion of it all.

But boy it does feel like we are getting shafted !!

Your point about the excise is very valid.... I honestly didn't know it was a fixed amount.. I assumed it was a percentage.

Maybe we are both right.... I know I'm getting shafted... just maybe I'm blaming the wrong guys..

Cheers, Mark
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Reply By: Best Off Road - Friday, Jan 23, 2009 at 18:52

Friday, Jan 23, 2009 at 18:52
Paul,

I read this at work today, so had a look on the way home.

Mobil Hallam an hour ago 105.4

Cheers,

Jim.

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Reply By: Member - Jeff H (QLD) - Friday, Jan 23, 2009 at 19:10

Friday, Jan 23, 2009 at 19:10
Paul,
The ACCC rep was interviewed re fuel prices in Bundaberg yesterday; a possibly unfair summary of his comments follows:-

1. There is a weekly cycle of prices in capital and some major cities.
2. Diesel is expensive because demand is high.
3. LPG is expensive (in Bundaberg) because demand is low.
4. We will be watching prices.

I kid you not!

Jeff H.
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Reply By: Member - Footloose - Saturday, Jan 24, 2009 at 13:49

Saturday, Jan 24, 2009 at 13:49
Apart from Landy, few have mentioned the following;
"Excise, a Federal Government tax, is 38.143 cents per litre for diesel, ULP (unleaded petrol), PULP (premium unleaded petrol) and LRP (lead replacement petrol) as well as ethanol and biodiesel blended with diesel. There is no excise on compressed natural gas, LPG (liquid petroleum gas), ethanol or 100 per cent biodiesel until 2011."

So the taxman has his hand in your wallet every time you buy the stuff. Is it too high a tax to pay ? Definitely ! No wonder the Govt can collect a surplus. Especially when GST is added to the total bill, in effect a tax on a tax.

Perhaps rather than looking at the fuel companies and outlets, we should be questioning exactly what happens to our fuel taxes.
Schools and hospitals? Roads? "General Revenue?"


AnswerID: 345731

Reply By: Geoff (Newcastle, NSW) - Saturday, Jan 24, 2009 at 17:19

Saturday, Jan 24, 2009 at 17:19
What you must remember is the ACCC and the Fuel Watchdog were both asked to WATCH the price of fuel.

At no point were they actually asked to ACT on the price of fuel.

We should all dip our lids to a couple of gubbamint outfits that have fulfilled their charter perfectly.

Geoff

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Reply By: Sir Kev & Darkie - Monday, Jan 26, 2009 at 09:04

Monday, Jan 26, 2009 at 09:04
We got a new load of fuel on Saturday and the prices are now
$1.089 for Unleaded
Diesel is still $1.179


Cheers Kev
Russell Coight:
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Follow Up By: Member - Paul Mac (VIC) - Monday, Jan 26, 2009 at 09:09

Monday, Jan 26, 2009 at 09:09
BRAGGER !

:-)))
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Follow Up By: Sir Kev & Darkie - Monday, Jan 26, 2009 at 13:38

Monday, Jan 26, 2009 at 13:38
hahahaha

I must go and get some Diesel soon before it goes up again ;)
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