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One Australian city gets rorted on petrol prices. Why?

A woman filling up her car at a petrol station.
Image: Getty

The consumer watchdog has found motorists in Brisbane consistently pay more for petrol than the other large capital cities.

The Australian Competition and Consumer Commission, in its latest quarterly report, found nationally fuel prices were at its highest in four years after taking inflation into account.

ACCC chair Rod Sims said the low Australian dollar was to blame.

"The most significant contributor to this increase was the depreciation over the year in the AUD-USD exchange rate, which decreased by USD 0.06 to USD 0.72... This was the lowest annual average AUD-USD exchange rate in the last 15 years," he said.

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"The AUD-USD exchange rate is a significant determinant of Australia’s retail petrol prices because international refined petrol is bought and sold in US dollars in global markets."

In the five largest cities – Sydney, Melbourne, Brisbane, Adelaide and Perth – Australians are now paying 7 cents more per litre than they did last year.

But drivers in Brisbane are especially in pain.

The quarter ending June saw motorists there pay 148.2 cents per litre, which was 3.6 cents higher than the other large cities.

The latest period is not an exception, with an ACCC report in October 2017 finding that Brisbane was the most expensive place for the prior eight years.

Why is petrol so expensive in Brisbane?

Does petrol cost more in Brisbane because the ports are further from the refineries? Or because the taxes are different?

Petrol stations are simply skimming a higher profit out of Brisbanites, according to the ACCC report.

"The main factor influencing the higher prices in Brisbane was higher retail margins on petrol, which contributed to profits in Brisbane being significantly higher than the average across Australia."

There was less competition in the fuel retail scene in the Queensand capital, with service stations setting higher prices at the bottom of the cycle than in a city like Sydney.

"Brisbane had fewer retail chains that were effective and vigorous price competitors. Brisbane had only four retailers in this category (7-Eleven, Woolworths, Puma Energy and United), while Sydney had seven (Speedway, Metro, Budget, Westside, United, 7-Eleven and Woolworths)."

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