Petrol prices

Dick Honan, the man who sparked the political debate that led to oil companies being forced to offer motorists ethanol/petrol blends, has won again.BP announced yesterday it had contracted with Mr Honan's Manildra Group for the supply of 40 million litres of ethanol during the next year, with the possibility of extending the agreement for a further two years.Manildra Group is Australia's biggest producer of ethanol, which is a by-product of its wheat-based industrial starch business, based at Bomaderry in southeastern NSW.For years Mr Honan conducted an acrimonious debate with the major oil companies, accusing them of refusing to supply him with wholesale supplies of petrol so that he could distribute a 20 per cent ethanol petrol blend.The use of ethanol reduces the petroleum industry's share of the fuel market.In 2003, it was revealed that Mr Honan had met secretly with Prime Minister John Howard in August 2002 before the Government introduced a scheme under which ethanol would not attract excise until 2011, thus destroying an ethanol import market.That policy was designed to force oil companies to supply ethanol blends, so that the Government's uncosted 2002 federal election promise to develop biofuels industry of 350 million litres a year by 2010, originally seen as a boost to the struggling sugar industry, which could be achieved.While the federal Government has encouraged oil companies to blend ethanol with petrol, up to a maximum of 10 per cent, the NSW Government has mandated a 2 per cent ethanol level across the product range from October 1.Oil company representatives said yesterday this was not achievable across the whole of the retail business, as many petrol distributors and wholesalers would not be ready in time.Effectively, the switch to E10 blends will see the gradual wind-back of the existing 91-octane unleaded petrol, with the ethanol blends having octane ratings of about 94 , making them compatible with new, fuel-efficient car engines.BP said yesterday that, as a result of its deal with Manildra, it would offer new BP Unleaded 91 to NSW motorists at a 3c a litre discount through its Biorewards program.Currently, BP's 88 sites across Queensland, NSW and the ACT are being supplied with the new fuel. By the end of the year all 50 BP branded service stations in NSW will be selling the new product in place of regular unleaded petrol.BP Australia president Gerry Hueston said the company's actions demonstrated its commitment to create a sustainable future for biofuels in Australia.Both Shell and Caltex said yesterday that BP was well behind in supplying ethanol-petrol blends across Australia. 

Petrol giant BP Australia has conceded price cycles are confusing and causing 'angst' to the motoring public.However BP, in its submission to the Australian Competition and Consumer Competition's petrol inquiry, says the cycles are indicative of a competitive petrol industry and do benefit consumers.“However many consumers do not perceive it to be a good thing,” it says.It concedes that public perception of the industry is poor, but refutes the common criticism that petrol companies increase prices before weekends and public holidays.“Price movements leading up to long weekends are generally exactly as they would be in any other period,” it says.BP said movements in retail petrol prices at its outlets closely followed movements in the Singapore parity price. “At times we see divergence between movements in the Singapore price and local retail petrol prices,” BP says.However, it said divergences were the result of "market behaviour," and “offset each other over a period of time”.BP agreed with the statements made to the committee by Shell and Mobil, that a highly competitive market had contributed to Australian motorists paying among the lowest prices in the developed world.BP Australia, in its submission, also say, supermarket shopper dockets face an "uncertain future” because of intense competition in the supermarket business.An increasing number of imports have entered Adelaide since the closure of Port Stanvac, with the trend expected to continue.Price cycles are not unique to Australia, yet the “short and sharp” nature of the cycles is uncommon.The ACCC inquiry is expected to report to federal Treasurer Peter Costello by October 15.The committee will hold a public hearing in Adelaide on August 29. 

Petrol shopper docket schemes could be scrapped if Australia's consumer watchdog rules they are pushing up fuel prices.There is growing industry concern the schemes used by millions of supermarket shoppers to get 4 cents off per litre for their fuel bills may have backfired on motorists.Independent petrol companies and service stations, which blame shopper dockets for driving them out of business, have appealed to the Australian Competition and Consumer Commission.They argue the popular schemes are eroding competition and contributing to motorists being ripped off at the bowser.In Brisbane, supermarket affiliated petrol stations control an estimated 70 per cent of the unleaded petrol market. Skyrocketing petrol prices, which are biting household budgets, have become an election issue.An inquiry into the price of unleaded petrol was launched by the ACCC in June, which is also examining the structure of the industry, the extent of competition and barriers to 'efficient petrol pricing.' In its submission to the inquiry, Australia's largest independent petrol retailer United Petroleum said the shopper docket had lead to supermarkets "absolutely dominating" the retail market.“The ACCC must take steps to even up the playing field,” it said. It recommends the watchdog either scrap the scheme or restrict the discount to such a level that it cannot be used as a “predatory tool.”Analysis by Professor Joshua Gans, from Core Research, also raises doubts about the benefits of shopper dockets to motorists.“I urge the ACCC to take another look at these shopper docket schemes and use the data available to them to see whether these have improved or reduced the overall benefits of competition in petrol retailing,” he said.The Motor Trades Association of Queensland said the domination of the market by supermarkets and oil majors was impacting on “genuine sustainable competition”.It also expressed concern about the reduction in the number of service station outlets in small country towns, especially on major western highways.Dannie and June O'Connell, both 56 from Graceville, filled up their four-wheel-drive yesterday at a northern suburbs petrol station.The couple said they “benefited” from the discount petrol vouchers. “But we're not under any illusions that you pay more for your groceries to counteract for the fuel prices,” Mr O'Connell said. 

Fuel prices appear set to increase by the end of the month after the International Energy Agency warned that many refineries around the world seem unable to process sufficient quantities of crude oil.The Paris-based organisation, which acts as an energy adviser to 26 developed countries, made the comment after crude oil prices reached a 10-month high in New York on fears that refinery breakdowns would slow US petrol production.According to a survey published in the US, refinery output was just over 90 per cent last month, compared with more than 93 per cent at the same time last year.In Singapore yesterday crude oil for August delivery was at $US71.31 a barrel, down US10c on the New York close on Tuesday.The August contract had risen US32c, or 0.5 per cent, to $US71.41 a barrel during Tuesday, reaching its highest close since August 25.On the London market, which accounts for more than 80 per cent of the world's traded oil, a barrel of Brent crude was down US5c to $US72.88 a barrel.Both markets have been affected by the US Independence Day holiday, which delayed the scheduled release of data on US fuel inventories by one day.Demand for petrol in the US, the world's biggest oil user, usually peaks between June and August as summer holiday travel puts more cars on the road.Oil reached its record of $US78.40 on July 14 last year when increased demand coincided with the release of forecasts indicating an above-average US hurricane season.But prices declined 26 per cent in 11 weeks as holiday driving demand eased and the hurricane season passed without any major damage to oil and gas production assets.In its latest report the Australian Institute of Petroleum said that unleaded petrol prices across the country were trending down at 121.7c a litre.They have fallen 3c per a litre in the past month but are still ahead of the 118.5c a litre they've averaged during the past 12 months.The consumer watchdog, the ACCC, has been instructed by the federal Government to investigate why retail petrol prices have not moved in line with movements in the Singapore benchmark price for motor gasoline.The ACCC investigation will report by mid-October. 

Unleaded petrol costs have risen 5.6 per cent since this time last year, but hidden costs are the main culprits responsible for pumping up motoring budgets, the survey found.The RACV 2007 Vehicle Operating Costs survey said hidden costs such as servicing, insurance and loan interest rates on average rose up to 7 per cent compared to last year's survey.At the same time, depreciation figures show vehicles' value falling faster.After examining the 37 top-selling vehicles across 10 categories, the survey found the cheapest car to own and run was the Hyundai Getz at $116.54 a week.This was $5.34 more than last year's cheapest vehicle, the Kia Rio.The most expensive was still the Toyota Landcruiser GXL turbo-diesel, at $357.51.The Mitsubishi 380 ES was the most affordable family car at $200.44 a week, a weekly increase of $4.46.Meanwhile, lower price and service costs helped Ford Falcon outperform its rival Holden Commodore, costing $229.13 a week compared with $233.40.RACV Chief Engineer of vehicles Michael Case said the Federal Government's $1000 grant to LPG car purchases helped ease the overall running costs of these models.Although eight vehicles across the 10 categories managed to retain last year's rank as cheapest in their class, there were still some significant cost increases.For example, the Kia Carnival rose 14.7 per cent to $216.68, while the Honda CR-V cost $203.86 a week, a 7.4 per cent jump from last year's survey results.Mr Case said the survey showed the cost benefits of diesel and hybrid vehicles, which more motorists were considering investing in as fuel prices continued to skyrocket."A diesel Volkswagen Golf will save you around $2.95 a week - nearly $770 over five years," he said.""That's also a saving of around 11kg of greenhouse gas each week," he said."The Honda Civic hybrid meanwhile, provides a fuel saving of $9.46 a week and can save 17.9kg of greenhouse emissions."The survey data was collected in March and April.RACV calculations are over a five-year ownership period and are based on the average operating conditions for the private motorist, including travel of 15,000 km a year.

Once shrugged off as a minor irritant, the subject of fuel economy has become one of critical interest to the Australian heartland.Getting your vehicle, be it petrol or diesel, to go as far as possible on the least amount of fuel is ultimately going to put dollars back in your pocket ... but how do you do it?Most people think of fuel-economy driving in terms of special cars crawling along, with highly trained drivers gently brushing the accelerator only when absolutely necessary.Not true, says Holden engine management engineer Scott Doughty.Doughty is part of the team responsible for ensuring there is that balance of economy and performance real-world customers demand in their Commodores."The general rules for efficient fuel economy in everyday driving don't just apply to our cars," Doughty says. "Much of it is commonsense and the technology in modern engines is pretty much industry standard."Some of the golden rules are applicable to everyone: Keep the gears up, get into the high gears as early as you can, keep the engine revs down, all those sort of things."Many people, particularly those who have been driving for a long time, think that by driving with lower throttle openings but higher engine speeds they are saving fuel and putting less stress on the car."In fact the opposite is true. Lower engine speeds and greater throttle-opening — that is, a higher gear — is far more efficient so get to the higher gear quickly and stay there as much as you can."Increasing mass and drag is another sure way to spend more time in petrol stations."People fill their cars with all sorts of stuff and drag it around all over the place or they bolt a big roof rack on the roof — anything like that is going to make the aerodynamics less efficient and add to drag," Doughty says."I just don't think they realise the amount of fuel they are using. They don't need to do that. It is as simple as unbolting the roof rack or unloading the boot."However, the fuel-saving strategy is not restricted to high-tech or smaller engines. He says: "There is a degree of improvement you can get from any engine. You can achieve some pretty good economy, even on V8s."To prove that point Holden has each year run an efficiency drive from Sydney to the Gold Coast; almost 1000km of real-world driving. Each of the cars is set a fuel and speed target for each stage over a variety of conditions, ranging from city and highway to mountainous backroads.Some of the results are truly surprising — with V6 models returning figures in the 7.5L/100km range and V8s under 10L/100km.While the obvious purpose of the exercise is to show benefits of the Holden models, there are lessons to be learned for owners of most brands. Key to the results from the V6 engines was the Alloytec's throttle-off fuel saving technology; something that is now common in current-generation engines.Before the advent of the latest engine control units (ECUs), the use of gears to force engine braking brought no fuel benefit. With the new technology, the same behaviour will put dollars in your pocket.Doughty says idling in neutral or lifting off the throttle in high gears where the revs fall below 1600rpm is not going to aid fuel consumption significantly."Fuel is still being fed to the engine to keep it running. But if you throttle off and use the gears to keep the engine revs between 1600rpm and 2100rpm, the ECU cuts fuel to the engine, allowing the engine to be turned over by the drive wheels rather than fuel ignition in the cylinder chambers," he adds.The ECU re-opens the fuel feed when engine revolutions are moving out of the nominated range or the throttle is depressed.Doughty says that with variable valve-timing, cam-phasing, electronic throttle control and modern electronic control units the strategy can be used without negative effects on the engine."It may take a bit of an education program but it is certainly something that can be used on a daily basis," he says.While loath to quantify the possible dollar savings from more efficiency-conscious behaviour, Doughty has no doubt that most people could benefit significantly: "Fuel economy becomes 100 little things that together to make a significant improvement."Keep to the golden fuel rules1. Keep the car in as high a gear as possible and get to the higher gears as quickly as possible.2. Have a light touch on the throttle. For most applications 25 per cent throttle is quite adequate. Hard acceleration is the enemy of fuel economy.3. Look ahead and read traffic conditions. Plan to maintain momentum, reducing the need for excessive braking and subsequent acceleration.4. Monitor tyre pressures. Low pressures increase rolling resistance of tyres and use more fuel. You should keep to the manufacturer's specifications.5. Stick to the speed limit. High speeds use more fuel.6. Reduce mass and drag. You would be surprised how much unnecessary equipment accumulates in the boot of a car. Roof pods, racks and extended wing mirrors all minimise the efficiency of a car through the air. More weight and drag equals less economy. Remove the bits when they are not being used.7. Avoid idling as you are wasting fuel going nowhere.8. Keep your vehicle in shape; clean air filters keep impurities in the air from damaging the engine and can improve fuel economy.9. Don't turn on the airconditioner as a first response to heat; even the most efficient airconditioners expend a fair bit of fuel.10. When buying a car, consider its fuel economy.

The average this week was 113.3 cents a litre with petrol prices steady in urban markets but dropping for a 12th straight week in regional areas.But Commsec analyst Martin Arnold says what a steady oil market gives, the drought has taken away."With the effects of the drought and the third interest rate increase for the year impacting on household finances, falling petrol prices will be of little comfort," Mr Arnold wrote in a summary of the petrol market released today.While the average household is now $34 a month better off compared with six months ago, and the rural economy also has benefited from a significant drop of 1.5 cents in diesel prices, the changes would go largely unnoticed, he said.Even in urban areas, Mr Arnold said, savings made on petrol would not be going back into the retail economy."These savings are more likely to be saved, or go to increasing mortgage or rental payments, rather than being spent."AAP

Australians are now paying an average of 117.6 cents per litre for unleaded petrol.Commsec chief equities economist Craig James says the benchmark Singapore gasoline price has fallen twice as far as the Australian pump price."In addition, Australian wholesale or terminal gate prices have fallen by a cent a litre over the past week and motorists have yet to see that reduction passed on at the petrol pump," Mr James said in his latest regular analysis of the petrol market."CommSec expects average Australian petrol prices to level out around $1.10-1.15 a litre in the next fortnight."The cheapest capital city petrol price is in Brisbane, where motorists are paying 104.7 cents per litre, while the most expensive capital city is Darwin at 127.9 cents per litre.AAP

The release of the two new models of the top-selling cars has seen them manage comparable figures to the outgoing models and in Holden's case, even slight improvements in some models.It has been toughest to achieve improvments in automatic gearbox cars.The four-cylinder Camry boasts better economy figures than the six-cylinder Commodore (9.9 litres per 100km compared to the Holden's 10.9 litres per 100km) when comparing base model automatics.However the new, larger and heavier Camry is thirstier than other popular four-cylinder family cars such as the Honda Accord Euro (9.2 litres per 100km), the Hyundai Sonata (8.8), the Mazda6 (8.9) and the Subaru Liberty (9.1).The new Commodore and the current model Falcon are the thirstiest but the figures achieved by the LPG Falcon show that if you really don't want to pay high fuel prices, it is the way to go.That is particularly relevant now as LPG prices in Sydney this week were about one-third of the average price of unleaded petrol. However, you will need to refuel the LPG car more often than its petrol equivalent.Holden released the VE Commodore's fuel consumption figures on Monday while the new Camry figures (8.9L/100km for manuals and 9.9L/100km for autos) were released on Tuesday. Holden's executive engineering director Tony Hyde says: "We finished our testing late last week, the Omega is 10.9 litres per 100km, 0.1 of a litre better than the VZ."It's not all glory and roses but it's still a pretty good story, the V6 with the five-speed auto was 11.4 and is now 11.3, except for the Calais V -- the one usage of that engine where the figure is slightly up," he says.The fuel consumption figures for the base model are equal to the Ford Falcon equivalent, and slightly higher than the Mitsubishi 380 which has a consumption rate of 10.8 litres per 100km.Hyde says the variable-valve V6 and the V8 with manual gearboxes had also experienced a small reduction in thirst."The premium HF V6 with the manual gearbox was 11.4, it's now 11, the V8 manual was 14.6, down to 14.4," he says.He says the addition of a six-speed automatic gearbox might have been expected to reduce fuel thirst but the new transmission -- shared with the Cadillac and the Corvette -- had increased fuel consumption."The one that has gone the other way is the V8 with the six-speed automatic -- logically you'd think it would not -- it's gone from 14 to 14.3," he says. "The six-speed's ratios don't seem to suit the cycle, so we'll be looking for real world figures -- we're confident of getting some pretty good numbers from it."The lead-time for developing a new car means reacting to rising fuel costs in the past 12 months was largely impossible, according to the Holden engineering boss."We can't react inside a year, no way, the engine calibrations and the emissions work that needs to be done," he says.Hyde says fuel economy was now very important. "The biggest issue now is fuel consumption, more so than power outputs."We would improve fuel consumption figures by making the car lighter, but it's not that easy. We can't just leave bits off."He says Holden hopes to trim weight for the next Commodore model, though the lure of a diesel is strong.Holden has been testing its hybrid VX Calais model fitted with a 3-litre in-line turbo-diesel from BMW.This car is a pointer to the future, though GM has no deal with sourcing engines from BMW. The primary problem is the expensive price of the BMW engine.Diesels available include 3-litre V6s from GM-associate Isuzu which are used in European-specced Renault Vel Satis and Espace, the Fiat-Lancia Thesis and Saab 9-5.Even Fiat's 2.4-litre, in-line five-cylinder turbo-diesel is plausible, especially given Holden provides the Fiat Group with a derivative of the Commodore V6 engine.However, more likely is a GM-designed and built mid-capacity turbo-diesel believed to be under development.Fuel savings will be available in September with the release of a 175kW dual-fuel LPG base model. One thing ruled out for Commodore is turbocharging: "no turbos", Hyde says emphatically.Holden powertrain manager Simon Cassin says Holden is looking at methods for creating more efficient engines.That includes the ability to turn off four cylinders on the V8 engine to save fuel, as in the US version, which is also used on the Chrysler 300C V8.He says ethanol fuel was being studied. The maximum ethanol content of fuel regarded as being safe for a Holden engine is 10 per cent.The first road tests of the new Commodore start in Melbourne next week.

More than 25,000 admirers, tyre kickers and buyers packed the Convention Centre at South Bank on the second day of the show last Saturday, smashing all previous records.The 8000 increase on the previous single-day best crowd was helped by the official season launch of the V8 Supercar championship which featured all the stars and cars of the Holden versus Ford series in nearby Little Stanley St.While most come to dream there are those who use the opportunity to compare notes between rival brands at close range and under the one roof.With fuel prices remaining high, the cost of running a vehicle remains a key buying consideration among many buyers.For those wanting to stretch their dollar further at the pump there are fresh injections of turbo diesel variants in the passenger car line-up including Volkswagen's Polo oil burner for $22,990.Lexus provided the Queensland public with its first look at the GS450H saloon, a luxury petrol/electric hybrid which is scheduled to do business in local showrooms from May.BMW, which is showing off a new range of V8 engines in the 5, 6 and 7-series at the show, says it will have a hydrogen-powered 7-series on Australian roads in two years but there is a need for government intervention to possibly sort through filling station infrastructure.While the future is firmly set on alternative power sources, there remains an unwavering passion for hot blooded exotic sports machines.In performance alley at the show there is the stunning Pagani Zonda Roadster, priced at $1.3 million or the equivalent of four median-priced Brisbane homes.While Holden is flooring the fans with the hot rod Efigy, it also previewed its next four-wheel-drive wagon, the Capitva.VW took the covers off the new Passat sedan and wagon while Fiat had a range of Puntos which will signal the Italian maker's return to the passenger car ranks in Australia this year. The show continues until Sunday.