With wholesale petrol and crude oil prices rising, $1.50-per-litre fuel is coming again, and CommSec and RACQ are warning motorists to fill up now.
Singapore's gasoline price - the market in which Australia gets much of its fuel - lifted by US 90 cents a barrel to a nine-week high of $49 a barrel, according to CommSec senior economist Ryan Felsman.
"With global oil prices lifting and the East Coast retail petrol price discounting cycle concluding last week, more motorists can expect to see unleaded pump prices closer to $1.50 a litre in the coming fortnight," he said.
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This is in contrast to April, when there was a glut of oil supply, pushing prices of futures into negative pricing territory, which saw motorists enjoy 80 cents/litre petrol.
Mr Felsman said petrol prices are now in the rising phase of the cycle, and motorists should fill up now.
"That said, there is still cheap fuel available if motorists take the time to consult real-time fuel apps and shop around," he said.
In the past week, the Australian Institute of Petroleum reported the national average price of petrol fell to an 11-week low of 116.2 cents per litre (cpl).
However, retailers in the past week had a margin of about 17.3cpl of fuel, which is above the 24-month average of 14.5cpl, according to CommSec.
Motorists hit with longer fuel cycles
Since the COVID-19 pandemic began, east coast drivers have been hit with longer fuel cycles as retailers attempt to recoup losses from less driving, according to Mr Felsman.
"Retailers have been protecting their profit margins with fewer drivers on the road during virus lockdown 2.0 [in Melbourne]," he said.
"Pump prices declined at a snail’s pace over the month-long discounting cycle."
Prior to the pandemic, motorists in Sydney, Melbourne and Brisbane saw fuel cycles take about 16 days to the trough.
However, since March, the downward portion of the cycle has lengthened - in Brisbane in March the cycle took 37 days to reach its trough; in Sydney it was 38 days, while in Melbourne it was 41 days.
The latest data from the Australian Competition and Consumer Commission (ACCC) indicates for June/July, it took 26 and 27 days to the bottom for Sydney and Melbourne respectively, while taking just 11 and 10 days to rise to a peak.
In Brisbane in June, it took 18 days to the bottom and just 9 days to the top.
RACQ spokesperson Lauren Ritchie told Savings.com.au that they are concerned about fuel retailers hiking the fuel cycle earlier.
"In Queensland unleaded and diesel sales have largely recovered, with the latest data showing they’re at more than 90%of the pre-COVID levels," she said.
"Hiking early boosts average fuel company retail margins and we’re concerned that fuel companies are doing this in Queensland to offset losses caused by COVID lockdown in Victoria."
Ms Ritchie recommended using fuel saving apps, such as RACQ's 'Fair Fuel Finder' app, to "send a message to the expensive retailers that they need to compete for your business".
The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:
- The big four banks are: ANZ, CBA, NAB and Westpac
- The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2019. They are (in descending order): Credit Union Australia, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
- The larger non-bank lenders are those who (in 2020) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
Some providers' products may not be available in all states.
In the interests of full disclosure, Savings.com.au, Performance Drive and Loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.
*The Comparison rate is based on a $30,000 loan over 5 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.
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