A fuel price reform is in effect from today, with the introduction of updated legal requirements for fuel retailers to improve fuel price transparency and predictability for motorists.
Fuel retailers have to set their fuel price until 2pm a day before, with the capped price published on Servo Saver at 4pm.
The prices will be capped for 24 hours from 6am the following day and retailers can reduce the price during the 24-hour period but they cannot increase it.
Under the reform announced the Consumer Affairs Victoria, the maximum fuel price are capped for each fuel type and reported by fuel retailers from today, Wednesday 11 March.
Fuel retailers must ensure fuel price information is updated as soon as practicable or within 30 minutes of any change, and report any type of temporary fuel shortage.
This comes after residents scramble to fill up the tanks as a dramatic fuel price increase is expected and seen in some areas due to the conflict in the Middle East.
The disruption to the Strait of Hormuz, where 20 per cent of the world’s oil passes the critical shipping route, has caused global oil prices to surge.
One Facebook user posted a Dandenong fuel retailer who portrayed only 179.9 cents per litre on a Petrol Spy app as well as the Servo Saver app to attract consumers only to find the price is 199.9 just yesterday as the new reform was announced.
People were quick to report the retailer to Consumer Affairs and Petrol Spy to stop them from advertising on the apps.
The same fuel retailer’s fuel advertisement cannot be seen on the Servo Saver app anymore.
Prices reported by retailers feed directly into Servo Saver – the official fuel price comparison tool in the Service Victoria app. This allows drivers to make informed decisions about where and when to refuel.
According to the app, the highest fuel price sits on 240.9 cents per litre in Springvale, average sits on 230 and 220 in Greater Dandenong with 199.5 being the lowest in Springvale.
A few locations in Dandenong and Noble Park flagged 210 and 200 cents per litre.
The Victorian Automotive Chamber of Commerce (VACC) however calls it, “double squeeze” for fuel retailers, absorbing rising wholesale fuel costs and managing consumer frustration.
At the same time, VACC is making a direct appeal to motorists: “the person behind the counter did not set the price on the sign.”
“Fuel retailers are not the ones setting global oil prices,” VACC chief executive Peter Jones says.
“They’re operating on margins of just a few cents per litre, yet they’re the ones facing customers at the bowser when prices spike. That’s an incredibly difficult position to be in.
“This is a genuine double squeeze. Costs go up, margins stay thin, and the person wearing all of that pressure is usually a small business owner and their team,” Mr Jones said.
He calls an attention to the “mounting pressures” on fuel retailers, saying roughly 30-35 per cent of every litre sold goes towards Government taxes-fuel excise and GST.
Global fuel costs including crude oil, refining and international shipping make up a further 50–55 per cent, leaving retailers with a “slim margin.”
“Service stations are price-takers, not price-makers. When global markets move, retailers feel it immediately — but they have almost no capacity to cushion the blow for customers or for their own businesses,” Mr Jones said.
The federal government on Tuesday held a meeting of the new fuel taskforce, a government grouping with key industries such as transport, to address supply chain issues.
Energy Minister Chris Bowen maintained that fuel imports are arriving as expected and that rising prices are due to panic buying.
Minimum reserve requirements are in place if needed. The main concern of the federal government now is to meet the current demand, especially from farmers.
“The key message is, while there are challenges and uncertainties in all international supply chains at the moment, the preparations that the government has put in place for the minimum stock obligation are working,” he said.
“If it’s necessary to access those minimum supplies, we will, but we’re not there at this point.”
Suppliers are required to hold minimum reserves of petroleum products. Refiners must hold 24 days worth of usual demand for petrol and 20 days worth of diesel supply. Importers, who account for around 90 percent of the country’s fuel supply, must keep a reserve stock of petrol and diesel worth 27 and 32 days, respectively.
The Servo Saver app was launched last year as part of the Fair Fuel Plan, with more than 265,000 Victorian users signed up, saving an estimated $333 a year at the pump.
Petrol stations that fail to register or report their prices now face fines of more than $3,000 for each breach, or more than $24,000 if taken to court.
