Treasurer Josh Frydenberg signals measured response to coronavirus economic impact

In rare good news amid the coronavirus panic, petrol prices could soon be dropping for motorists. Oil prices have plunged and the consumer watchdog is set to see it is passed on.

THE competition watchdog has been set on petrol stations to pressure them to pass on big drops in fuel prices, in a rare piece of good news for Aussie consumers as stockmarkets continue to plunge amid the coronavirus panic.

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Treasurer Josh Frydenberg says he has asked the ACCC to make sure dropping oil prices are passed on to consumers. Picture: AAP Image/Mick Tsikas

Treasurer Josh Frydenberg warned today the economic impact from Covid-19 would be significant, but said the response would be measured and not made from fear.

But he revealed he spoke to Australian Competition and Consumer Commission boss Rod Sims this morning, asking him to take action on crude oil prices which have dropped 47 per cent since the start of the year.

“I wanted to re-emphasise to the ACCC the importance of holding the oil retailers to account in ensuring that the Australians get the benefit from the lower oil prices,” Mr Frydenberg said.

“The ACCC plays a monitoring role in with respect to prices at the bowser.

“They have assured me that they will not only maintain their monitoring role and the vigilance that that involves, but they’ll also be calling out any energy companies that don’t pass on the reduction in the wholesale price to the Australian consumer.”

While the ASX has dropped five per cent this morning, Mr Frydenberg said Australia was well placed to respond to the crisis as he foreshadowed the government’s stimulus package expected this week.

Australian Competition and Consumer Commission (ACCC) boss Rod Sims has been asked to make sure dropping oil prices are passed on to consumers. Picture: AAP Image/Joel Carrett

“It’s important to understand that the fiscal response that we will be undertaking is scalable. So we will make our announcements sooner rather than later,” he said.

“This is very different to the GFC, and so the response needs to be very different. And our response is both on the supply and the demand side, because we are seeing disruptions to the economy.

An announcement regarding a stimulus package, which could be worth as much as $10 billion, are expected later this week.

Opposition treasury spokesman Jim Chalmers joined calls from the government for petrol retailers to pass on any drop in oil prices to motorists.

“The petrol retailers in this country should not be taking us for mugs by hanging on to these substantial reductions in the fuel price,” he said.