In Summary

Melbourne motorists are paying the most for petrol, with research revealing petrol profit margins are higher than any other capital city.

Professor Abbas Valadkhani and Associate Professor Alperhan Babacan from Swinburne University of Technology, examined more than four years of data across 108 cities, with results showing 13 locations in which the profit margin for petrol was extremely high.

“Of these 13 locations, Melbourne was the only capital city. Other Victorian locations that topped the list included Swan Hill, Mildura and Wonthaggi,” said Professor Valadkhani.

Professor Valadkhani and Associate Professor Babacan’s research provides hard data to substantiate the claims surrounding suspected profiteering in the petrol industry.

“The location specific results of this study means price monitoring by the ACCC can become more cost effective. Regulatory bodies are able to focus their limited resources on the 13 locations where the likelihood of abnormal profit margins is very high,” said Professor Valadkhani.

It was also found that the extent of excessive profiteering in Western Australia was lower than other Australian states and territories due to the presence of the successful price monitoring performance of FuelWatch.

“FuelWatch is a beneficial initiative to motorists that creates transparency and increased knowledge of fuel price movements,” said Professor Valadkhani.

FuelWatch provides motorists with access to fuel price information so that they can make informed purchasing decisions. According to this scheme, all petrol stations are required to post fuel prices for the next 24 hours using mandatory price boards.

Professor Valadkhani and Associate Professor Babacan’s analysis forms the basis of an academic article published in the international journal Energy Policy.

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