Prices in Australia are to be monitored. Photo / Bloomberg.
Prices in Australia are to be monitored. Photo / Bloomberg.
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CANBERRA - Petrol companies are involved in a "comfortable" oligopoly that is hindering competition, a major inquiry into unleaded petrol prices by the competition watchdog has found.
The Australian Competition and Consumer Commission (ACCC), in a report released yesterday, found "no obvious evidence of price fixing or collusion"but did find there were "fundamental structural issues" that hamper competitiveness.
The inquiry found 98 per cent of the unleaded market is controlled by four companies - Shell, Caltex, BP and Mobil.
"This makes for a very concentrated industry," the report said.
Commission chairman Graeme Samuel said there were competition constraints across the industry.
"Our inquiry found that overall the petrol market in Australia is competitive, however, we did find some structural factors that operate to constrain a fully competitive market at all levels of the supply chain," Samuel told reporters at the inquiry's release in Canberra.
He said the inquiry had met its aim of delivering transparency to a market characterised by hard to understand contracts and dense terminology.
"Our report and the recommendations for future action contained in it are directed towards increased transparency and improving the effectiveness of competition in the petrol market to the benefit of all Australian consumers," Samuel said.
Assistant Treasurer Chris Bowen immediately directed the commission to set up a formal process to monitor petrol prices across the country. In the past, the commission has only performed informal "spot" monitoring of petrol stations.
The commission will publicly report annually with Bowen saying that could be changed if the commission found anything of concern.
"This is a very complex area and once a year, I think, strikes the right balance in terms of getting the information out to the community and if the ACCC comes back and says they feel it should be more regular then obviously I'd be happy to consider that."
Bowen promised yesterday's directive was only the start of a concerted effort to deliver increased monitoring of the industry.
The report suggests the nationwide adoption of the West Australian FuelWatch scheme, which provides motorists with price notification, may be a way of bringing transparency to the market.
