Abstract
Costs of transport fuels are the most significant components of household expenditures, and the price of petrol is of particular importance for commercial and residential sectors in Australia. Regarding the central role of petrol, an in-depth understanding of petrol price behaviours is essential. Previous studies mostly focused on the petrol markets in metropolitan areas, and there exists a significant gap in the regional literature. Therefore, this paper is aimed to develop a clearer understanding of petrol price patterns in urban and rural areas in Western Australia. This study finds a mismatch between pricing patterns across various regions and cities. There are cities with two types of price patterns, cities with price cycles and cities without. Most cities have not excessive fluctuations, and their price patterns are almost smooth. This group of cities have different levels of petrol prices. The greater distance with Perth raises petrol prices in these groups of cities. Cyclical patterns have been observed only in Murray, Mandurah and Geraldton. Comparative analysis reveals that asymmetric and frequent weekly cycles in three cities are similar to the cycle in Perth. It can be argued that there exist no specific differences in petrol price patterns among cities with cycle.
Highlights
As reported by the Australian Competition and Consumer Commission (ACCC), petrol price cycles mostly occur in the five Australian capital cities including Adelaide, Brisbane, Melbourne, Sydney, and Perth, but not in the smaller cities such as Canberra or Darwin
The following research questions arise: How petrol prices behave in regional areas? And, is there dispersion in petrol prices? In part, the ACCC conducted studies in regional petrol markets and found that petrol prices are higher compared with capital cities which may be a result of less competition
This paper is aimed to provide a contextual setting of retail petrol price behaviours across rural, regional and urban markets in Western Australia (WA)
Summary
As reported by the Australian Competition and Consumer Commission (ACCC), petrol price cycles mostly occur in the five Australian capital cities including Adelaide, Brisbane, Melbourne, Sydney, and Perth, but not in the smaller cities such as Canberra or Darwin. In contrast with these five capital cities, petrol prices in the regional areas are higher and less fluctuated (Australian Competition and Consumer Commission, 2019). Regional prices of petrol are significantly higher than in the Perth metropolitan area. The ACCC conducted studies in regional petrol markets and found that petrol prices are higher compared with capital cities which may be a result of less competition. This study is motivated to analyse the petrol price patterns across all regions in Western Australia, a subject which was less-focused by previous scholars
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