Australia's Biggest Fuel Merger Just Hit a Wall and What Happens Next Affects Every Driver

Something significant just shifted in Australia's fuel landscape, and it's going to affect every motorist whether they realise it or not. Ampol's $1.1 billion bid to swallow up more than 500 EG Australia service stations has just been sent to the competition watchdog's sin bin for further scrutiny. And the timing couldn't be more interesting.

The ACCC announced last week that it's pushing Ampol's proposed acquisition into a Phase 2 review, marking the first major test of Australia's brand new mandatory merger control regime that kicked in on 1 January 2026. In plain English? The regulators aren't convinced this deal is good for Australian drivers, and they want a much closer look before giving it the green light.

What's Actually Being Proposed Here

Let's break this down. Ampol, which runs around 1,800 branded service stations across Australia, wants to buy EG Australia's entire network of more than 500 fuel and convenience sites. If you've filled up at a servo with the Woolworths fuel discount offer lately, you've probably been to an EG Ampol station. That's because EG Group bought Woolworths' petrol business back in 2019 for $1.73 billion.

Now the British owners want out, and Ampol's offering $1.1 billion to take the lot. On paper, it sounds like a straightforward consolidation play. One major fuel retailer buying another. But ACCC Commissioner Dr Philip Williams has flagged a rather significant concern: "The acquisition would combine two major fuel retailers in Australia."

The regulator has identified 115 specific locations where this merger could substantially lessen competition. That's 115 suburbs and towns where your choice of where to fill up could shrink, and where the competitive pressure keeping prices honest could evaporate.

Why the ACCC Is Worried

Here's what most people don't realise about fuel retailing. Competition in this industry plays out at a very local level. A servo in Parramatta isn't really competing with one in Bondi. Your decision about where to fill up is based on what's convenient, what's on your route, and what's within a few kilometres of where you are right now.

The ACCC gets this, which is why they've done a granular analysis of local market overlaps. And what they found isn't pretty. Beyond those 115 problem locations, the regulator has also flagged broader competition concerns across the metropolitan areas of Brisbane, Canberra, Melbourne and Sydney.

Ampol tried to get ahead of these concerns by offering to divest 19 retail fuel sites. The ACCC's response? Not good enough. Nineteen stations don't come close to addressing competition problems at 115 locations, let alone the metropolitan wide concerns.

The Bigger Picture: Australia's New Merger Rules

This review is historic for another reason entirely. It's the first acquisition to face a Phase 2 assessment under Australia's completely overhauled merger control framework that became mandatory on 1 January 2026.

Going back a few decades, Australia had one of the weakest merger control regimes among developed economies. Companies could essentially merge first and apologise later, with the ACCC left to chase them through the courts if they thought competition had been harmed. That's changed dramatically.

Under the new system, certain acquisitions must be notified to the ACCC before they proceed. And you can't complete the deal until you've got clearance. Phase 1 reviews are meant to be quick, around 30 business days, for straightforward transactions. But if the regulator spots problems, they can escalate to Phase 2, which gives them up to 90 business days to dig deeper.

The stakes are serious. Completing a notifiable acquisition without ACCC approval is now a breach of competition law and could trigger penalties up to $50 million. From 1 January 2026, deals that proceed without clearance are automatically void under Australian law.

A Brief History of Musical Chairs

To understand how we got here, you need to know the convoluted history of Australian fuel retail branding. It's genuinely fascinating when you dig into it.

Ampol was founded in 1936 as the Australian Motorists Petrol Company, specifically to combat price gouging from foreign owned rivals. The company opened its first retail site in Mosman back in 1952 and became an iconic Australian brand.

Then came the 1995 merger with Caltex, which saw most Ampol stations gradually rebadged as Caltex over the following decade. For most Australians under 40, Caltex was the only brand they knew.

But here's where it gets interesting. When Chevron (which owned the Caltex brand) decided to return to the Australian market in 2019 by buying Puma Energy's petrol station chain, they terminated the licence agreement that let the company use the Caltex name. So in 2020, Ampol came back from the dead, investing $160 million to rebrand 1,900 stations.

Meanwhile, Woolworths entered the petrol game way back in 1996, starting with a single outlet in Dubbo. By 2018, they had 540 stations. But when BP's $1.75 billion takeover was blocked by the ACCC on competition grounds in 2017, Woolworths eventually sold to EG Group instead for $1.73 billion in 2019.

Now EG wants out, Ampol wants in, and the ACCC is asking some pointed questions about what this means for you at the bowser.

What This Actually Means For Your Wallet

The practical upshot for drivers comes down to one word: choice. In fuel retail, competition keeps prices in check. When you've got multiple operators competing for your business, they have incentive to sharpen their pricing. Take away that competition, and there's less pressure to offer you a fair deal.

Research consistently shows that market concentration in fuel retail correlates with higher prices, particularly in regional areas. Studies have found that the absence of independent retailers in Australian regional centres maintains upward pressure on petrol prices.

With Western Australia's seven day price cycles often lauded as a model for stability, and cities like Perth enjoying prices around 25 cents per litre cheaper than eastern states at various points, the structure of local markets clearly matters.

Right now, if you're in Melbourne or Sydney, you're dealing with price cycles that can stretch to 38 days according to RACQ data. That's up from weekly fluctuations back in 2010. The NRMA has been calling for the ACCC to investigate these extended cycles, arguing they're leaving families with fewer opportunities to fill up at the cheap end of the cycle.

Against this backdrop, the last thing motorists need is further consolidation reducing competitive pressure.

The Road Ahead

Ampol has said it "remains confident in its position" and expects the transaction to complete by mid 2026 following the Phase 2 assessment. The company will have opportunities to offer additional remedies, perhaps divesting more sites, to address the ACCC's concerns.

The ACCC is accepting public submissions until 4 February 2026. After that, they've got up to 90 business days to make a final decision. They can approve the deal outright, approve it with conditions (likely requiring significantly more divestments than the 19 sites already offered), or block it entirely.

For the broader fuel industry, this decision will set an important precedent for how Australia's new merger regime operates in practice. And for smaller players like United (with its 400 plus sites representing about 6 per cent of the market) and Puma (with 360 stations), the outcome could reshape the competitive landscape they're operating in.

What You Can Do

While regulators deliberate, drivers aren't powerless. Fuel price comparison apps and websites, including our own interactive fuel map, give you real time visibility into pricing at stations near you. Using these tools to shop around sends a signal to the market that price matters.

If you've got strong views on whether this merger should proceed, the ACCC's public submission process is open until early February. Industry bodies representing motorists, small fuel retailers, and consumer groups will all be having their say.

The fuel industry rarely makes headlines until prices spike, but understanding these structural changes now puts you ahead of the curve. Whether Ampol gets its 500 extra stations or not, the decisions being made in Canberra right now will shape what you pay at the bowser for years to come. Keep an eye on this space.