Petrol price inquiry

I have made two submissions to the ACCC’s inquiry into petrol prices. The first concerns the impact of shopper docket schemes on retail petrol pricing. As reported in today’s Australian Financial Review:

Economist and managing director of consultancy firm Core Research, Joshua Gans, called on the ACC to revisit the issue of shopper-dockets and warned of the pressures faced by retailers not aligned with the major supermarkets.

“While in the short run this is a problem for them [retailers], in the long run it becomes a problem for competition,” he said.

Providing weight to that concern was Mobil, which along with BP does not have an alliance with a major supermarket. It has told the ACCC that the shopper-docket schemes have led to instances where discounts have exceed what it views as the “available fuel marketing margin.”

In theory, such schemes have the potential to raise prices. The ACCC has the data to actually test whether this was true. I hope they conduct that test.

The second submission provided a suggestion as to how the government might make petrol retailing more competitive in the interests of consumers and eliminate petrol price cycles. The idea was to compel price data to be made available on the Internet to be linked in with search tools such as Google Maps.

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