Bargain hungry motorists descended on the Shell service station at West Launceston on Saturday to fill up with unleaded on sale for 99.9 cents per litre.
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It's a far cry from the average $1.58 per litre Launceston motorists paid for petrol in the last three months of 2019, according to the Australian Competition and Consumer Commission (ACCC).
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Service station owner Ravi Kasturi said he made the decision to cut the price of unleaded after hearing from customers who had been affected by the coronavirus pandemic.
"Some of them were out of a job...it's getting too hard for everybody," Mr Kasturi said.
"I took the matter to Nathan at Tas Petroleum, we had a very good discussion last night and decided we were going to help everyone."
"As they were dropping the prices we thought we'd do the same and help everybody in Launceston."
Mr Kasturi said he wanted to keep the price at 99.9 cents per litre for a "couple of days".
"I've been the cheapest in town for a long time, not many people knew," he said.
RACT general manager of mobility services Darren Moody welcomed the sight of unleaded on sale for below $1 per litre.
"Currently the wholesale price of fuel in Tasmania is below 90 cents per litre and that's almost the lowest I can remember it in probably 20 years," Mr Moody said.
"Anybody that's selling fuel at 99 cents per litre is to be recognised and supported."
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Mr Moody said Tasmanian motorists had paid too much for too long when it came to fuel.
"What we've seen over an extended period of time is 10, 15, 20 cents per litre over what we think is reasonable.
"Fuel companies, particularly in Tasmania in the last three or four months, have shown no conscience. They've taken advantage of Tasmanian motorists significantly.'
Fuel would always cost more in Tasmania than on the mainland, Mr Moody said.
"We do have a little bit of extra freighting cost, we've got lower volumes that go through the service station sites so there are some increased costs.
"Those increased costs, as outlined in the ACCC's fuel inquiry into Launceston, should be around three, maybe five cents per litre at a stretch."
