Fuel farce delivers 20c rip-off

October 18, 2008 12:55am

• Oil price falls, petrol price rises
• Experts say motorists are being gouged
• Fear prices will rise further

MOTORISTS are being ripped off by up to 20c a litre at the fuel bowser as petrol companies exploit the plunging oil price.

The Daily Telegraph today debunks the major oil companies' often-used excuse that the declining Australian dollar offsets any savings from the steep fall in crude.

Expert analysis reveals the cost of oil in Australian dollars has dropped more than 20 per cent since the start of September - yet petrol prices have risen more than 5 per cent.

University of NSW competition professor Frank Zumbo said petrol industry data showed motorists buying at the top of the retail cycle on Wednesdays were being gouged between 15c to 20c a litre extra.

"Retail and wholesale margins are historically higher than in the past, and retailers have been pocketing the fall in prices rather than passing savings on to motorists," Professor Zumbo said yesterday. "Motorists are being ripped off and the savings haven't been passed on as quickly as they should have been."

Professor Zumbo said there were growing fears prices could increase further if the Australian currency continued to fall below US70c.

With the cost of petrol plunging in the US to about $A1.15 a litre, Sydney motorists continue to be slugged some of the highest fuel prices in Australia, with unleaded peaking at 159.9c a litre yesterday.

NRMA president Alan Evans said the price gouging was about 8c a litre, but "probably higher".

Price-monitor Fueltrac's spokesman Chris Kable said because wholesale margins for unleaded had fallen over the past week, oil companies were recouping that cost by increasing their retail margins.

The chance of action by the Federal Government or competition regulators seemed remote last night.

Australia's new petrol commissioner Joe Dimasi was unavailable yesterday and the Australian Competition and Consumer Commission declined to discuss the petrol issue.

While it's true the Australian dollar has shed about 30 per cent of its value since mid-July, from 98c to 69c now, the oil price has dived 50 per cent - from more $US140 a barrel to barely $70 yesterday. Caltex said changes in retail prices were consistent with oil in currency fluctuations.