Originally Posted by Amazulu

One of the things I've learnt and studied in my Oil and Gas MBA:
Diesel is mainly used as an industrial fuel - ships, power generation, trucks, heavy machinery etc. It's use as a personal transport fuel is limited. So when economies are doing well and industrial activity increases, the price of diesel rises to reflect this - and vice versa. We live in a region where a lot of Asian economies are steaming along (forget all the bollocks you read about China slowing, they are still growing at around 7.5% and will continue to do so), therefore the demand for diesel is high, driving its price higher. We import a lot of diesel, mainly from Asia. If you remember back to 2007/8 when China's economy was white hot leading up to the Olympics. Australia was also booming. The price of diesel here went through the roof

But saying that

I'm sure the oil companies/supermarkets are tacking on a bit extra as well. Shell/Coles and Caltex/Woolworths are big culprits of this IMO. Their diesel prices, around here anyway, are always the highest - and by a big margin. I tend to find that Gull (or Puma as it now seems to be called), which is an Aussie company, usually have the best price

Originally Posted by GarryP

I knocked this up to show how the fuel price cycle makes money. The solid chunk at the bottom is the terminal gate price of fuel (how much the distributor sells for). We can assume the Coles/Woolies lot get a bit of a discount on this, so given a margin for the station which is typically 4% in the UK, we get somewhere in the green zone (a guess, but probably right).



As you can see, at the bottom of the cycle, the garage might actually be making a loss, with the supermarket also eating the cost of the 4c voucher on top (even with 50 litres of fill up, its still only worth $2 max). However at peak they are getting 20c extra margin (15% extra) and they arrange the length of the cycle such that the average time between fillups (16 days) means you HAVE to buy at an enhanced margin rate eventually. This is why they no longer have a weekly cycle.

As for the diesel price. It doesn't run a price cycle, meaning there is a constant margin for them. They also do the same "no cycle" in Canberra & Hobart on unleaded - I guess since there is no real chance of them being undercut by competitors, etc. Diesel is a few cents more in such locations (accounting for the increased energy content), and if you look at, say, Melbourne and take account of this offset, you get the 'flat' diesel price bisecting the price cycle. In other words the overall effective profit is the same, they just get it another way.

Originally Posted by moneypenny20

Paid $1.42 for E10 yesterday. Bit naffed off as our closest Caltex has just been bulldozed and won't be back in service again for 8/9 months. Have to drive 15 mins up the motorway to get my discount. Wouldn't bother but the nearest petrol stations now are all way more expensive than I pay, it's cheaper to travel to fill up than use them.

Originally Posted by old.sparkles

Had a quick look on the drive home - cheapest diesel I could see was $1.37.

Petrol still $1.285

Originally Posted by Alfresco

Wow, that's much cheaper. I have never seen prices like that here.

Originally Posted by old.sparkles

Apparantly one of the stations is selling at $1.21 - don't think they do any discounts but at that price

Originally Posted by Alfresco

Minimum fill 100L.

Originally Posted by Alfresco

I wonder if the slash in crude oil prices will mean a lower PP in Oz?

I say it won't.

Originally Posted by Alfresco

That sucks.






Wow, that's much cheaper. I have never seen prices like that here.

Originally Posted by carolinephillips

$1.29.9 here on the North Shore of Sydney. (And you can get 4c off that price if you shop at the supermarket chain.)