Caltex Australia said today's petrol price increases in many capital cities are typical of the weekly price cycle operating in those cities.

Caltex last week predicted false allegations of petrol price gouging would be made by critics in the run-up to the Easter holidays.

"Today's increases in petrol prices are typical of the weekly discount cycle that occurs in many capital cities," said Caltex Managing Director and CEO Des King. "Weekly price cycles before holidays are often incorrectly claimed to be holiday price increases.

"Apart from the daily effects of the discount cycle, petrol prices have risen in the past two weeks because of higher Singapore refinery prices for petrol, which Australian prices are based on.

"Petrol prices have increased about 16 cents per litre since late January, mainly because higher crude oil prices due to tensions in the Middle East have increased Singapore refinery prices for petrol.

"Today's increase in petrol prices and the weekly price cycle are the result of competition - there is no price gouging and price cycles are not the result of collusion.

"The Australian Competition and Consumer Commission (ACCC) says the price cycle is evidence of a volatile market in pricing which, of itself, is evidence of competition. The ACCC also says that attempts to remove the price cycle would be to the detriment of consumers, rather than to their advantage.*

"Petrol prices don't all increase at the same time and there is no collusion but competitors watch each other closely - Caltex receives updated market prices every 30 minutes from an independent price monitoring service - and prices can change quickly after a week or more of discounting.

"The myth of holiday price increases was debunked in Caltex's submission last year to the Senate inquiry into petrol pricing. Caltex's views on the myth of holiday price increases have been supported by the ACCC and some of Australia's state automobile associations."

Charts of petrol prices from last Easter clearly show discount cycles continued up to and through the holiday period. There were no abnormal price increases.

Information on petrol pricing is available at www.caltex.com.au/FuelPricing, including the charts for Easter 2006 published by Caltex last week.

Caltex's 2006 profit was only 2.2 cents per litre on average for all petroleum products sold.

Contact:
Frank Topham, Government Affairs & Strategic Communications Manager
Phone/pager: 02 9250 5357

* Senate Standing Committee on Economics, Price of petrol in Australia, Committee Hansard 19 October 2006, p23