Any time petrol prices rise, the average family feels it in the back pocket.
It affects not only the cost of running our car, but it also affects business. And when their costs increase, the price of everything else we buy seems to rise as a result. That’s just how things work.
And when our fuel prices rise significantly, it somehow becomes a political football, with opposition parties blaming whatever government for the rise. For the most part, however, that’s nonsense.
The simple fact is, our petrol prices have increased following a decision last month by OPEC – the Organisation of Petroleum Exporting Countries – to cut oil production, coupled with a fall by the Australian dollar against the US dollar.
This double whammy caused the wholesale price of fuel to rise, which has now seen the dramatic rise in fuel prices at the bowser witnessed late Tuesday.
It’s not very palatable when fuel prices do rise, particularly 20 cents a litre. But for state Labor to come out on Wednesday and blame the state government was disingenuous.
According to the Australian Automobile Association, there are a number of different factors that make up the price motorists pay for their fuel.
The example its website uses - $1.30 a litre for unleaded - says that in that instance the actual cost of the fuel is about 65 cents a litre. This figure is based on the Singapore benchmark price for petrol.
Shipping makes up a further 1 to 2 cents a litre. The federal government's taxation, in the form of a fuel excise, adds a further 39.5 cents and then GST is added. All up, about 50 cents a litre is in government charges.
Then a wholesale and retail margin is added, about 10 to 20 cents a litre.
Transparency already exists, for the most part. So other than forcing petrol stations to list the undiscounted price of fuel – as is Labor’s plan – it's difficult to see how there could be any more transparency. And that's hardly going to reduce the cost of fuel.
As for the claim Tasmanians are being "ripped off 20 to 40 cents a litre", that's highly questionable.
The NRMA's website listed Sydney's unleaded fuel price between $1.29 a litre and $1.45 a litre on Wednesday, with the average at $1.42 a litre. In Launceston it was about $1.45 a litre. Hardly 20 to 40 cents a litre.
So if you want to blame anyone, blame OPEC and the Australian dollar.