Study finds petrol stations colluding with each other to rip motorists off

A STUDY has finally confirmed what we always suspected — petrol stations have been colluding with each other to rip us off.

DRIVERS are paying more at the bowser each year because petrol stations have been colluding with each other to rip us off, a new study has found.

The sneaky profit-boosting strategy has seen petrol stations boost their prices by 15 to 20 cents per litre on Thursdays, before decreasing by two cents each day until the next hike

Research has found a motorist driving a 70L Toyota Camry could be paying up to $135 per year extra if they do not fill up on the cheapest day of the week, as seen between 2010 to 2015.

The first of its kind study, which analysed 1.7 million petrol prices over 15 years, found all retailers including independent stations were involved in the price increases.

University of Melbourne’s Dr David Byrne said the copycat tactic was never spoken about between retailers.

“It was around 2010 when we noticed petrol retailers were co-ordinating on price changes in an unspoken way,” he said.

“They were achieving price co-ordination, and making higher profit margins, without speaking (to each other) at all.”

It’s been proven — we’re being ripped off more each year at the petrol bowser. Picture: iStock

“We found a gradual, slow process where each station started to adhere to the pricing norms. “Overtime we started to see margins rise over the entire cycle.”

Profit margins jumped a staggering 700 per cent between 2010 and 2015.

The joint study between University of Melbourne and University of Sydney is the first of its kind where every petrol price in Perth was analysed over 15 years.

Dr Byrne could not say whether similar trends were being played out in Melbourne — as no data had been compiled in a similar way to the Perth study.

“In Perth the petrol price cycles work like clockwork — every Thursday prices jump by 15 to 20 cents per litre and then are progressively cut back by two cents per litre per a day until the next Thursday price jump when the cycle repeats itself,” he said.

“This tacit collusion softened price competition, resulting in higher profits for all firms involved, and higher prices for consumers.”

Dr Byrne said motorists could save money if they monitored petrol prices often.

“People need to pay attention to the prices, that’s the one thing you can do,” he said.

“Get engaged in the petrol apps like Fuel Watch.”

Read more about the study here.

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@Kara_Irving

Originally published as Study finds petrol stations colluding with each other to rip motorists off