Lack of competition among Brisbane fuel retailers resulted in motorists paying $50 million too much at the bowser last financial year, a report by the consumer watchdog has found.
But the body representing major and independent fuel retailers and wholesalers has refused to apologise for Brisbane fuel prices, saying retailers are not charities.
Australian Competition and Consumer Commission (ACCC) chairman Rod Sims said the report, released today, found Brisbane motorists paid 3.3 cents per litre more for petrol on average than motorists in Sydney, Melbourne, Adelaide and Perth.
He said this was despite the fact that since 2009-10 terminal gate prices (the wholesale spot market price) were virtually the same in Brisbane as Australia's four other largest cities.
"It confirms complaints that motorists have been paying too much for petrol and that some local fuel retailers are enjoying high profits at the expense of drivers" he said.
"The high retail prices and margins for petrol in Brisbane have cost motorists there around $50 million per year more than their interstate counterparts since 2009–10.
"This is despite wholesale prices in Brisbane being similar to those in the other four largest cities."
Mr Sims said the lack of independent chains was a key reason Brisbane prices were consistently higher than other state capitals.
Australasian Convenience and Petroleum Marketers Association chief executive Mark McKenzie made no apology for Brisbane fuel service stations, saying they operated in a free market.
"It seems to be an assertion thrown around ... that we should be operating as some sort of charity where we're just passing costs through," he said.
"Service stations are actually businesses and they operate in a market where the architecture of the market is defined by the intensity of competition.
"Fuel businesses will discount very heavily where there's aggressive competition and they will discount less heavily where the competition isn't as intense."
'Significant change' in Brisbane market
The ACCC report noted that the number of small independent petrol retailers had more than halved in Brisbane since June 2007.
The Queensland capital has four independents: 7-Eleven, Puma Energy, Freedom Fuels and United.
But Sydney has seven independent chains, some of which explicitly state their aim to sell competitively priced petrol.
"Independent chains can be competitive price setters in large metropolitan markets and their absence means that prices are otherwise higher," Mr Sims said.
The ACCC report said Brisbane motorists who shopped around and timed their fuel purchases could save $10 to $15 on a 60-litre tank of petrol.
The consumer watchdog is advising drivers to download fuel price apps and to check websites to decide when to buy and from where, in a bid to encourage stronger competition among Brisbane fuel retailers.
Brisbane drivers 'need to support cheaper servos'
Renee Smith from Queensland motoring group the RACQ said Brisbane motorists had paid $400 million too much for fuel over the past eight years.
"It's a rip-off," she said.
"Motorists have a roll to play in competition as well — we need to be supporting the cheaper service stations.
"If we're just filling up wherever and whenever, that may be at one of the dearer service stations, and they're not going to drive down their prices if they're still getting plenty of business."
