CANBERRA is one of 28 “fuel rip-off hot spots” around the country, according to researchers from the University of New England.
Professor Abbas Valadkhani from UNE Business School says the study clearly identified a phenomenon he refers to as “rocket/feather pricing”, where the price of fuel rockets up at the first sign of any upward movement in the cost of crude oil, but only ever falls back down very slowly, like a feather.
Canberra Metro is among 28 locations identified as hot spots for “rocket/feather” pricing through a study conducted between 2007 and 2012.
“We looked at 111 locations across Australia covering the daily and weekly data for the period, and it appears that the vast majority of petrol stations are doing the right thing, however around a quarter of the service stations reviewed were participating in this rocket/feather pricing,” says Prof Valadkhani.
The study’s authors suggest that having a government-led fuel watch pricing agency, like in Western Australia, is an effective policy to combat the suspicious price movements.
“The only place where everyone is doing the right thing is in Western Australia,” Prof Valadkhani says. “While we can’t prove the connection, Western Australia is the only state with a Government backed Fuel Watch body.”
A relatively large number of independent fuel retailers, as in South Australia, appears to help the prices drop back more quickly, according to the study.
Prof Valadkhani says UNE’s Business School will next look into exactly who is profiting from “rocket/feather pricing”.
“The reason we see petrol stations ripping motorists off is simply because they can, [and] the evidence is clear that only effective government regulation and monitoring can ensure petrol stations ‘do the right thing’. “Until the ACCC decides that they should actually be looking at petrol prices, motorists will continue to pay more at the pump.”