A SHARP drop in unleaded fuel prices across the city is unsustainable, a local service station owner says.
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Average fuel prices fell by 13 cents in Goulburn last week – a result that stemmed from the Hume Highway Shell service station’s decision to lower its prices dramatically last Wednesday week.
While the decline is saving motorists in the short-term, the reduced rates are putting fuel providers at stress.
That’s the view of Braidwood Road Mobil service station manager, Bryce Blay.
Due to its independent nature, the Mobil distributive depot regularly advertises Goulburn’s cheapest fuel.
But even they are struggling to match the recent drop.
“We either have to look after our own customer base by lowering our price, or we have to let our customers go. We only have one choice,” he explained.
“Our price structure is worked on the terminal gate price for 24 hours. Our price can change daily.
“We put that to the public daily. If it goes up, we go up, if it goes down, we go down.
“We have the advantage of being an independent distributive. If the price drops today with one of our providers, we buy it and we can drop the price.
“But even we can’t keep up with this.” Fuel price watchdog MotorMouth last Friday found the average price of unleaded petrol in Goulburn in the week prior to September 19 was 140.8 cents a litre.
The corresponding price on September 12 was 153.9 cents a litre. The drop was exclusive among regional NSW towns and cities. Prices at Tumut, Albury, Ballina, Bathurst and Dubbo, among others, remained steady.
Furthermore, fuel gate prices – the cost at which wholesalers acquire petrol – stayed put.
Unleaded petrol gate prices in Sydney were last Friday listed at 137.6 cents a litre. Therefore, Goulburn providers were pocketing a little over 2.5 cents per litre of fuel sold – a stingy mark-up of 1.96 per cent.
Mr Blay suspects the drop is evidence of a game of cat and mouse. He predicts that Goulburn prices will increase for the school holidays.
A spokesman from the Australian Competition and Consumer Commission said Shell’s decision did not breach regulations. Providers are within their rights to set fuel prices as they see fit.
“Fuel prices are set by participants in the relevant market,” ACCC media unit manager Duncan Harrod explained.
“The ACCC’s role is to prevent anticompetitive conduct, such as price fixing or collusion, to protect consumers.”
Goulburn fuel prices are affected by the ebbs-and-flows of the Sydney market,” Mr Harrod added.
“Sydney has a petrol price cycle and is currently experiencing an extended price cycle,” he explained.
“As Goulburn does not have a petrol price cycle, the price differential with Sydney’s average petrol prices tends to increase when Sydney’s petrol prices move toward the lower range of its price cycle.”