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The truth about fuel price cycles – and how to time your fill-up
You drive past the servo and do a double-take, because the price of fuel has jumped 30 cents overnight. What gives?!
Unleaded petrol prices move up and down with some regularity in Australia’s bigger cities, and knowing your local patterns can save you more than just a few cents. So how do you crack the code to paying less money for exactly the same product? Let’s start by examining…
The awkward truth about fuel price cycles
Fuel prices do follow a pattern in bigger cities, but that pattern isn’t consistent across cities, states, or even days of the week.
Depending on the city, the lowest points of a fuel price cycle could be anywhere from one week to six weeks apart or even longer. Perth’s is the shortest cycle with a fairly steady weekly rhythm – so cheap Tuesday still holds water in the west. Meanwhile in Sydney, Melbourne and Brisbane, it can easily take a month and a half to reach a low point again. Cycles tend to sharply increase from their lowest point then gradually fall again, which explains why prices can seemingly jump overnight.
What drives fuel price cycles?
As the ACCC explains, price cycles are shaped by the pricing decisions of fuel retailers rather than the wholesale cost of fuel. Basically, when there’s more competition, retailers will adjust their prices to attract consumers and to turn a profit at various points of the cycle. As such, you don’t see these cycles happening in smaller cities like Darwin, Hobart or Canberra – though some regional locations have recorded price cycles. Diesel, which doesn’t have as much retail demand as petrol, is also not really subject to these same cycles.
