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ACAPMA PETROLEUM INDUSTRY REPORT JOIN ACAPMA ACAPMA IS A NATIONAL INDUSTRY BODY REPRESENTING FUEL DISTRIBUTORS AND FUEL RETAILERS IN AUSTRALIA ACAPMA Membership includes access to a range of benefits: • ADVOCACY: on behalf of the industry • EMPLOYMENT & COMPLIANCE: advice, support health check audits, template documents & representation (including unfair dismissal) • TRAINING: and recognition schemes focused on standardised online safety and compliance training for employees in fuel retail, transport & contractor roles • EVENTS: by the industry, for the industry • NEWS & INFORMATION: updated daily online and delivered to your inbox every Friday EMPLOYMENT ADVOCACY EVENTS TRAINING INFORMATION ACAPMA 1300 160 270 communications@acapma.com.au "It’s beyond belief that ... somehow the Premier and Chief Ministers in these small markets believe they should have seen ‘normal’ fuel market behaviour during the COVID-19 downturn." 56 CONVENIENCE WORLD JUL/AUG, 2020 FROM PAGE 54 When asked this question, political representatives have suggested using the ‘terminal gate price’, but as we’ve already discussed, this instantaneous benchmark doesn’t necessarily reflect the actual ‘buy price’ for the fuel in the ground unless we’ve had a long period of very stable oil and finished fuel import prices (including exchange rates). This runs the risk of governments setting a price cap that’s not actually representative of real-world economics for fuel retailers. Given that around 2,500 fuel businesses are competing with each other – not just six big ones – each with different cost profiles and wholesale purchase profiles, the application of a uniform market cap runs the risk of two adverse market outcomes. The first is that the cap is set so low that service stations with high costs and low volumes (eg, those in regional areas and outer ring metropolitan areas) will simply not make enough money to remain viable and will be forced to close, with consequent impact on local access to fuel and a concentration of market competition. The second is that the cap is set so high – to prevent the first adverse impact – that fuel retailers which normally discount will simply keep their price higher than they otherwise might, and all motorists will pay more in fuel costs over time. In short, the proposal is dangerous from a motorists’ perspective, let alone an industry and jobs perspective. It’s interesting to note that a quick review of the Australian Petroleum Statistics produced by the federal government shows that average petrol and diesel prices in Australia are the fourth and fifth lowest of all OECD economies. By comparison, those countries that apply fuel price regulation typically rank among the top 10 for highest fuel prices in the OECD. It remains to be seen how these recent threats against our industry will play out, but if history is any guide, government fuel price regulation in these three markets will likely increase average fuel prices for motorists, not lower them. CAPMA 18603 HP .indd 1 27/7/20 3:37 pm