| 10.01,12. 03:48 AM |
Petrol prices rocket towards $1.60
by: Michelle Ainsworth, Stephen McMahon
January 10, 2012
LONG-suffering drivers must brace for more pain as petrol prices threaten to top $1.60 within weeks.
Workers returning from the Christmas break were whacked with prices of $1.51 a litre upwards yesterday morning as an 11-day price cycle peaked.
Prices are expected to surge as global oil costs spike over concerns that escalating violence in the Middle East could curb supply.
The rise will bring bowser prices in Melbourne close to their highest ever weekly average, recorded in June 2008, of $164.8 per litre.
CommSec chief economist Craig James yesterday warned the jump was a taste of things to come, predicting prices of $1.55 a litre before the end of the Christmas holiday period.
"Motorists will be a little bit disappointed seeing petrol prices ... but they're probably going to be even more disappointed over coming weeks because we expect prices to rise even further," Mr James said.
"I think we're probably going to see the high point of the discounting cycle somewhere between, somewhere getting up towards $1.55, the low point of the cycle somewhere around $1.30-$1.35."
The RACV hit out at retailers, claiming that companies routinely monitored each other's prices, and called on the Australian Competition and Consumer Commission to investigate "this co-ordinated action".
The peak body for motorists also criticised the major retailers for their wildly fluctuating pricing.
"Victorian motorists are frustrated and confused by the price cycle determining when fuel is at its highest or lowest price," RACV vehicle engineering manager Michael Case said.
"A few years ago it was common to see cars backed up at service stations every Tuesday, filling up on the day of the week known by everyone to be the 'cheap' day. 'Cheap Tuesday' no longer exists as the price cycle for fuel is now less predictable.
"The current price cycle can now vary from seven to 10 days and occasionally can extend even longer.
"In the past month alone we've seen the cycle at 11 days before the price jumped, up 15c from the day or two before."
Mr Case said yesterday's jump took prices 2c higher than the maximum in the previous cycle - backing the assertion that maximum prices were rising.
"The point of difference in this current cycle is it does seem to have gone to a new maximum price that's 2c a litre higher than the maximum in the last fuel cycle, and that last cycle was about 1c a litre higher than the one before," he said.
"Our advice to motorists would be to be aware of this upward trend and be aware of the fuel price cycle and try to fill up at the lower end of the cycle.
"It's really the only way motorists can save money.
"The key point there is that the difference between the minimum and the maximum is about 14-15c a litre."
Experts said the lowest prices in the cycle were now usually available on the 5th and 6th, 15th and 16th and 25th and 26th of each month, with the RACV urging motorists to send a message and buy only on those dates.
While most retailers moved as one on pricing, a Herald Sun survey revealed it still pays to shop around, even at the peak of the cycle.
Despite the vast majority of outlets slugging customers $1.46-$1.51, in Brunswick, Flemington and Fitzroy drivers could fill their tanks for $131.9 a litre.
The Caltex service station at Craigieburn had the state's highest rate, at one point charging $151.9 a litre.
The big two supermarket chains, Woolworths and Coles, who dominate the petrol market with sales of almost $12 billion last year, have consistently claimed to take only modest profits from petrol sales.
Woolworths last year reported a 18 per cent increase in petrol profits at $117 million.
Despite several inquiries, the ACCC has consistently failed to find any evidence of price gouging among Australian petrol retailers.