Drivers are reaping benefits at the bowser.
Drivers are reaping benefits at the bowser.

Fuel prices set to plummet

OIL prices have taken their biggest dive since 1991 and while it may not be good news for world markets, everyday motorists can expect to reap the benefits of the lowest fuel prices in years.

Yesterday, the cheapest fuel in the Gladstone area was 125.9c at United Gladstone in French St, compared with the highest at the Caltex in Chapple St at 143.9c.

Most hovered just above the 136c mark.

But in a 'perfect storm', created by fears of the coronavirus outbreak coupled with a price war between Saudi Arabia and Russia this week, the price at the pump could fall as low as $1 per litre.

Oil prices plunged by more than 20 per cent amid concerns the coronavirus outbreak would see energy demand fall as people cut back on travel.

CommSec chief economist Craig James predicted petrol prices could drop to $1 a litre, provided the Aussie dollar was reasonable stable.

According to the ACCC, price cycles are the result of deliberate pricing policies of petrol retailers, and were not directly related to changes in wholesale costs.

However, Treasurer Josh Frydenberg told reporters he had spoken to ACCC chair Rod Sims.

"I wanted to re-emphasise to the ACCC the importance of holding the oil retailers to account in ensuring that Australians get the benefit from the lower oil prices," he said.

"They have assured me that they will not only maintain their monitoring role and the vigilance that that involves.

"They'll also be calling out any energy companies that don't pass on the reduction in the wholesale price."