Wholesale Up 10 Cents, Retail Up 50. Who Is Really Profiting From the Crisis?
If you filled up this week and felt like the price on the board didn't quite match the headlines you'd been reading, you're not imagining things. Something doesn't add up, and some very powerful people are starting to ask why.
Here's the situation. Since the conflict in the Middle East escalated late last week, the wholesale price of petrol in Australia has risen by roughly 10 cents a litre. Diesel, about the same. That's the actual increase in what it costs a servo to buy fuel from its supplier. Yet in Sydney, Melbourne, and Brisbane, prices at the bowser have jumped by 30, 40, and in some regional towns, a staggering 50 cents a litre.
So where's the extra 20 to 40 cents going? That's the question the NRMA has been shouting from the rooftops this week, and it's the question that prompted Federal Treasurer Jim Chalmers to fire off a letter to the ACCC demanding answers.
The Numbers That Don't Stack Up
Let's break this down, because the maths matters.
According to the NRMA's real time pricing data, the average unleaded price in Sydney hit 209.5 cents per litre this week. Melbourne wasn't far behind at 207.7 cents. Brisbane edged even higher at 210.2 cents. Half the servos in these three cities were charging close to 220 cents a litre for regular unleaded.
Meanwhile, over in Adelaide, motorists were paying 185 cents. Perth drivers, 189.1 cents. Same country. Same global crisis. Same wholesale market. Yet somehow a 20 to 30 cent gap has opened up between the east coast capitals and the rest.
Now, normal retail margins in Australia sit around 16 cents a litre. That's the ACCC's own figure, averaged across the five largest cities over the past decade. It covers the servo's operating costs, staff wages, the electricity to keep the lights on, and yes, a profit margin. Sixteen cents. Reasonable enough.
What the NRMA is seeing right now is something very different.
'Ripping the Community Off'
Peter Khoury, the NRMA's spokesman, isn't one to mince words, and this week he didn't hold back.
"Oil companies are using the Middle East crisis as an excuse to jack up margins," Khoury told reporters. He pointed out that prices in Sydney, Melbourne, and Brisbane had "far exceeded" what you'd expect at the top of the normal price cycle, even accounting for global events. He called some of the price hikes "completely unjustifiable" and "absurd."
And the evidence backs him up. In Nowra on the NSW South Coast, prices at some servos jumped 50 cents in a single 24 hour period. Motorists were queuing at the handful of stations that hadn't yet hiked their boards. The price range in the Nowra area on Wednesday stretched from 160.9 to 211.9 cents a litre. That's a 51 cent gap between the cheapest and most expensive servo in the same town.
Think about that for a second. Two stations, possibly a few kilometres apart, selling the same product, with a 51 cent per litre difference. The fuel in both underground tanks was almost certainly purchased at the same wholesale rate weeks ago.
What the Treasurer Said
Chalmers' letter to the ACCC was about as pointed as a Treasurer's correspondence gets. "Unfolding events should not be used as an excuse for retailers to gouge customers or to increase prices opportunistically above and beyond the impacts of events in the Middle East," he wrote.
He asked the ACCC to monitor fuel prices closely and investigate any evidence of "misrepresentations regarding petrol prices, false and misleading conduct, or anti competitive conduct."
That last phrase is the important one. Anti competitive conduct. Because here's the thing most Australians don't realise about fuel pricing in this country.
The Uncomfortable Truth About Price Gouging
Excessive pricing is not actually illegal in Australia.
Read that again. A servo can charge whatever it likes for a litre of unleaded, and unless the ACCC can prove collusion, a coordinated agreement between competitors to fix prices, there's nothing unlawful about it. A single operator deciding to slap an extra 40 cents on a litre because they reckon the market will bear it? Perfectly legal.
The ACCC can monitor. It can publish reports. It can name and shame. But it cannot set prices, and it cannot fine a retailer simply for charging too much. The only lines that can't be crossed are collusion (competitors agreeing to set prices together), misleading conduct (claiming the price rise is due to wholesale costs when it isn't), and unconscionable conduct (exploiting a particularly vulnerable group).
This is why the NRMA's calls for the ACCC to "clamp down" on profiteering, while understandable, run into a legal wall. Australia, unlike some European countries, has no general prohibition on excessive pricing. It's a gap in the regulatory framework that gets exposed every time a crisis hits.
Compare that to Germany, where a federal transparency agency publishes real time margins and can refer outliers for investigation. Or South Korea, where the government can issue direct pricing orders during supply emergencies. In Australia, the market sets the price, full stop.
The Pattern That Keeps Repeating
Industry contacts will tell you this isn't new. Every time there's a global disruption, the same pattern plays out. Wholesale prices rise by a modest amount. Retail prices leap ahead. Margins balloon. Politicians express outrage. The ACCC writes a report. Margins eventually normalise. And nothing structurally changes.
We saw it during the early weeks of the Ukraine invasion in 2022, when retail prices hit 230 cents per litre in some capitals despite wholesale not justifying those levels. The then government's response was a temporary fuel excise cut, which the ACCC later found was only partially passed on to consumers.
The NRMA reckons the current east coast inflation is costing the average family in Sydney, Melbourne, or Brisbane an extra $426 a year compared to families in Western Australia. That's real money for households already squeezed by the cost of living.
Where the Cheaper Fuel Actually Is
Here's where it gets interesting, and useful. Not every servo is playing the same game.
According to the NRMA's data, almost a quarter of Melbourne stations were selling unleaded below 189.9 cents this week. In Sydney, about 12 per cent of stations were similarly competitive. These are the operators doing the right thing, passing through actual wholesale increases rather than padding margins.
The trick, as always, is finding them. Adelaide and Perth remain considerably cheaper, with averages sitting 20 to 25 cents below the east coast capitals. If you live in Melbourne's outer suburbs like Epping, Frankston, or Dandenong, you'll often find better deals than the inner city. Same goes for Sydney's western suburbs around Parramatta and Blacktown, where competition between servos tends to keep a lid on prices.
Fuel price comparison apps, including ours at Petrolmate, show real time pricing across every state. When the spread between cheapest and most expensive in a single city can hit 50 cents, checking before you fill up isn't just smart. It's potentially saving you $25 to $30 a tank.
What Happens Next
The honest answer? Probably the same thing that always happens.
The ACCC will monitor. It will likely issue a statement confirming that retail margins have exceeded norms during this period. It may even name some of the worst offenders in its next quarterly report. Politicians on both sides will express concern about cost of living pressures.
But unless the law changes, and there's zero indication it will, the core issue remains. Australian fuel retailers have the legal right to charge whatever the market will tolerate, and global crises provide convenient cover to push that tolerance.
The NRMA is pushing for structural reform. Whether that means a real time margin transparency system, stronger ACCC pricing powers, or some form of emergency pricing mechanism, that conversation needs to happen when the crisis dust settles, not just during it.
For now, the most powerful tool Australian motorists have is information. Check prices before you fill up. Drive past the servo charging 220 cents and find the one charging 180. Those 12 per cent of Sydney stations and 25 per cent of Melbourne stations holding the line on fair pricing? They deserve your business.
Because the real story here isn't that a war in the Middle East is pushing fuel prices up. That's inevitable. The real story is how much of what you're paying has nothing to do with the war at all.
