RAC has called on fuel retailers to stop gouging motorists, after new research revealed they have failed to pass on significant falls in wholesale prices, choosing to dramatically boost fuel profit margins instead.
Research undertaken by RAC has shown that despite pricing at the pumps hitting historic lows in recent weeks, fuel retailers have been keeping most of the savings to themselves.
RAC Manager Vehicles and Fuels Alex Forrest said fuel companies should immediately reduce the significant margins they charge on fuel to make motoring more affordable when people need it most.
“Big reductions in the international oil price flowed on to reductions in fuel prices at the wholesale level in WA, but much of this was not passed on to motorists at the pumps,” Mr Forrest said.
“While many in our community are struggling through one of the toughest times of their lives, fuel companies have been beefing up their profit margins on fuel, in some cases by upwards of 100 per cent.
“This was especially evident in regional areas, where pump prices remained high for weeks despite big drops in wholesale pricing.”
In Kalgoorlie throughout January 2020, fuel sellers made an average of 20 cents per litre (cpl) from fuel they sold.
However, as the wholesale price of fuel dropped on the back of falling international oil prices, price drops were not passed on to consumers at the pump.
Between 1 – 23 March, average petrol prices at the pumps in Kalgoorlie fell by only 4.8cpl to 146.9, yet over the same time frame, big falls in the wholesale price meant margins doubled in Kalgoorlie, going from 26cpl to 52cpl.
“This is particularly telling because for every 1 cent petrol prices rise, an additional $19.2 million goes from motorists’ pockets into petrol company coffers,” Mr Forrest said.
Last week, fuel sellers in WA’s major regional centres were still making an average of 49c per litre, compared to 15cpl during the same week in 2019.
By comparison, in Perth last week, fuel retailers were carrying average margins of 13.7cpl.
Over a year, Western Australian motorists use approximately 1.36 billion litres of unleaded 91 petrol, which equates to a collective spend of about $1.92 billion.
“Western Australians typically have fuel bills of around $1500 per year, and those who still need to get around our State during these challenging times should not be paying a premium to do it.”
RAC urges motorists to use Fuelwatch to find the cheapest fuel near them, and to buy petrol at the lowest point in the weekly price cycle, which is currently Tuesdays.
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RAC Media Contact: Caitlin Barr, 0401 703 719 or media@rac.com.au
