New Ambulance Equipment thanks to Riordan Fuels
Click here to view the article (PDF).
Two More Tanks Installed & Operating at - 35 Lowe St. Corio (Geelong) Old Cheetham Salt Works & Lot 2 Old Peterborough Rd. Terang.
1.We have been endeavouring for some time to have a 68,000 lt tank situated in Geelong and have at last succeeded. The tank is at 35 Lowe Street Corio at the Cheetham Salt works or some may recognise it as the Corio Whisky distillery. This facility is very handy to commercial traffic, parallel to the Princes Highway on the trucking route to the wharves that handle fertilizer and woodchips.The Riordan Fuels card operates in this tank as per all our others and Visa or Mastercard are also accepted
We have also made arrangements with Ausfuel/Gull to have their cards accepted as well.
Please contact our office to commence an account for a Riordan Fuels card.
2. Expansion has been a key aim in the plan for our tank chain so the other new tank installed at Terang fits into these plans well. The same card options apply here as at the Geelong tank and as at all previous installations.
SEE TRANSTANK LOCATIONS SECTION ON THIS WEB SITE FOR SPECIAL INTRODUCTION OFFER AT THESE TWO NEW TANKS.
New Tank Now Operating at 720 Old Geelong Rd. (Princes Hwy.)Brooklyn West - Inserted 26/03/2012
A new 68,000 litre tank is up and running at 720 Old Geelong Road Brooklyn West (Princes Hwy.) Same principle as all others, Riordan Fuel card, Mastercard or Visa accepted. The site is directly opposite the Grieve Parade entrance to Old Geelong Road. Please use this tank if it is convenient for you.
Myth Busters - Diesel Prices Explained - Inserted 1/03/2012
Myth #1: Australians should not need to pay international prices for oil because we have enough to be self-sufficient
In fact Australia is not self sufficient in oil or oil products. Australia must import crude oil and refined products to meet total domestic demand. All of these imports are valued at international prices. Furthermore, if Australian prices were lower than international prices, then domestic refiners would be inclined to export products rather than supply the local market, resulting in Australia not having enough fuel for its needs.
Myth # 2: Diesel is easier to refine, therefore is should be cheaper
In Australia, Automotive Diesel Fuel requires as much refining as petrol. Diesel fuel sold in Australia is of a very high quality. Current Australian standards require a very low sulphur content (50 parts per million or less). This low sulphur standard helps to lower the emissions from diesel vehicles, but requires extensive treatment in the refining process to remove the sulphur from crude oil. Fuel standards also control other parameters, such as particulate matter and black smoke production. Hence modern diesel is a sophisticated fuel and requires at least as much processing as unleaded petrol.
Myth # 3: Petrol companies must engage in price collusion because all the board prices move at the same time
Companies do not collude with any other companies to set prices. Competitor prices are readily available as pump prices are usually displayed on boards. In addition we supplement this information with other competitor information we buy from an independent price monitoring company (who send us information on a very regular basis). We can be aware of major competitor price movements within 15 minutes. This intelligence gives us the ability to make pricing decisions very quickly. We have computer links to our agency sites allowing us to provide them with pricing instructions within minutes of making a decision.
Myth # 4: Fuel prices always go up in time for weekends
Fuel prices do not always go up for weekends. In most capital cities fuel price rises tend to occur midweek, and discounting commences prior to the weekend.
Myth # 5: Petrol companies use world events as an excuse to increase petrol prices
In order to maintain a healthy, profitable business we will vary our prices in line with international prices. Companies produce only a small percentage of the world's oil and gas, and are exposed to movements in the world oil market. Sometimes world events (e.g. supply disruptions like hurricanes, or political instability) will force up the cost of products, hence our prices will increase.
Find further information on fuel pricing in Australia
Australian Institute of Petroleum (AIP)
Royal Automobile Club of Victoria (RACV)
Australian Liquefied Petroleum Gas Association
Latest News Relating To Oil Pricing - Inserted 27/02/2012
The recent reports regarding oil pricing and consequently the affect on diesel prices to industry particularly transport and primary production paints a gloomy picture.
Crude oil in the past few weeks (both West Texas crude and Tapis crude) has risen once again to over $100 per barrel (WT) and $125 per barrel (Tapis). This trend is predicted to be with us for the foreseeable future. Unfortunately my crystal ball is not functioning and to predict with confidence is an impossible task.
In a statement issued today by Caltex whilst commenting on their last years results the following was published in "THE AGE" business section today. This report is concerning and should be noted as this affects us all.
"Caltex Australia," the nation's biggest oil refiner, swung to a full-year net loss after writing down the value of its plants by $1.5 billion.
Caltex shares were recently up 2 cents, or 0.2 per cent, to $13.
The company had a loss of $714 million in the 12 months ended December 31, compared with net income of $317 million a year earlier, the Sydney-based company said today in a statement. Profit, excluding the effect of changes in oil prices and one- time items, fell 17 per cent to $264 million.Advertisement: Story continues below
Caltex is considering closing its two refineries after completing a review of the assets in about six months, the company said February 16.
The company flagged earlier this month it would write down the value of the refineries because of competition from Asian plants and a strong Australian dollar.
“The recent deterioration in the performance of the refining business unit due to the challenging external environment, including the ongoing strength of the Australian dollar, lower refiner margins and increasing costs, is expected to be sustained for a prolonged period,” Caltex said today.
Caltex, half-owned by San Ramon, California-based Chevron Corp., operates the Kurnell refinery in Sydney and the Lytton refinery in Brisbane.
Recent News - As At 1/02/2012
MORE INFORMATION RE WORLD PRICING & GOVERNMENTAL RESPONSE.
FROM THE AUSTRALIAN PETROLEUM MARKETER NEWS.
THE OUTLOOK FOR WORLD OIL PRICING
The possibility of a significant world oil price spike remains a distinct possibility.
Tensions in the Middle East, the Iranian threat to close the Straits of Hormuz, through which 20% of the world‟s oil supply flows, the banning of oil imports from Iran by Europe, are all issues that have the potential to cause a significant price spike in the short term.
Australia's airlines – Qantas and Virgin, have already budgeted for a 30% increase in world oil prices in the coming twelve months.
Placing that in perspective for petroleum marketers, particularly for Australian wholesalers and retailers that will represent a 30% increase in debtors and inventory costs.
Placing it under even closer scrutiny, - for an average small to medium distributorship holding say a $5million debtors ledger, a 30% increase will require an additional $1.5million dollars to service the increased debtor ledger requirements.
Obviously, such market demands indicate that the time is now, to batten down the hatches and tidy up any debtor overdues and endeavour wherever possible, to reduce debtor ledgers, or even have them removed from the Balance Sheet through outsourcing.
However, the European Sovereign Debt crisis is having the effect of reducing oil demand and thus softening
the rate of price escalation. So too, the continued strength of the Australian dollar is assisting dampen petroleum price escalation.
Interestingly, Australian wholesale pricing for diesel throughout January has remained much the same, with ULP wholesale pricing increasing by around 3.70cpl.
Consumers within the retail market are copping a double hit in pricing increases with margins being increased as the major supermarkets lead the charge to cover anddeceive their customers, through their increased loyalty rebates – now ranging between 4cpl and 30cpl.
With the impotent ACCC Petrol Price Commissioner now seemingly adopting the stance of “what is wrong with that?”
Retail price manipulation through the manipulative “price cycles” now being a permanent feature of our petrol markets, with the two major supermarkets seemingly acting with impunity by increasing their loyalty discounts to whatever level they choose in their restrictive “cross subsidisation” processes.
Such activity will continue to decimate the independent marketers, the true essence of sustained competition within the Australian petrol markets.
The need for a Petroleum Industry Ombudsman will perhaps one day dawn on the regulators, although the past reaction to such a suggestion would seem to indicate we should not hold our breath until it happens.
MINISTER FERGUSON’S RESPONSE
TO OUR WRITTEN CONCERNS
ON DAYS COVER FOR DIESEL & PETROL
Regular readers of APMN will know we have been expressing concern relative to the deteriorating “days cover” for diesel and petrol in Australia. The current November 2011 “days cover” for diesel is (14) days, which is nearly 7% less than the previous year, with petrol having (17) days cover, which is 13% better than the previous year. (Refer to further comments in this issue)
Even a small interruption to Australia‟s supply line will create shortages which have the potential of seriously damaging our economy.
This editor wrote to Minister Ferguson on the 7th of October 2011 and finally received a reply on the 4th of January 2012. The reply, hived off by the Minister to one of his Advisors, seemed to indicate that we did not have a grasp of the overall issues and did nothing to address our specific concerns.
We reprint the memo:
From the Office of the Hon Martin Ferguson AM MP:
4th January 2012.
Thank you for your letter of the 7th of October 2011 to Martin Ferguson concerning the security of Australia’s refined petroleum product supplies. The Minister has asked me to reply on his behalf, and I apologise for the delay in responding.
The Australian government takes energy security very seriously, including the security of supply of refined petroleum products. The Government closely monitors developments in domestic and global markets for liquid fuels and independently evaluates the risks to Australia’s current and future energy security.
The Australian Government utilises a range of sources to inform analysis on energy, including the International Energy Agency (IEA) and Australia’s own geological, scientific and economic forecasting institutions.
The most recent analysis of Australia’s liquid fuels security is included in the National energy Security Assessment (NESA)2011 and associated material, which is available at www.ret.gov.au
Thank you for taking the time to write to the Minister. I trust this information has been of assistance to you.
Adviser – Energy
We still have a problem with our Energy Security and we will continue to draw attention to the issue.
DIESEL PRICE NOTES FROM THE AUSTRALIAN INSTITUTE of PETROLEUM - A.I.P.
(Inserted November 2011)
FACTS ABOUT DIESEL PRICES
The price of diesel in Australia is dependent on international market prices, not production costs
- Crude oil, diesel and petrol are different products and are bought and sold in their own markets.
- Each market is regionally based and there are linkages and transactions between regional markets.
- Diesel prices in regional markets reflect the supply and demand balance in each market.
- So, diesel prices (like most commodity prices) are determined by market forces, not by the cost to produce it.
- Australia’s regional market is the Asia-Pacific market.
- Diesel is the dominant fuel in the Asian region and in recent years there has been a significant increase in demand, particularly as a result of the economic and industrial growth in China and India; Australian demand for diesel has also grown strongly, particularly on the back of the mining and commodity boom.
- Regional diesel supply has not kept pace with this demand growth and, as a result, diesel prices have increased in the region including Australia.
- The Singapore price of diesel (Gasoil 10ppm sulfur) is the key diesel pricing benchmark for Australia.
Australian refineries must price their output to be competitive with Asian imports
- To meet Australian diesel demand, over 40% of diesel is currently imported - mostly from Singapore.
- Australian refiners must price diesel to be competitive with imports (ie. import parity) from the Asian region; if diesel prices were lower here, this would provide an incentive to Australian refiners to export diesel to Asia.
- Growing demand for diesel in Australia will continue to be largely met by imports in the future, further strengthening the price relationship with Asian diesel prices.
- The Australian wholesale price for diesel (called Terminal Gate Prices or TGPs) is closely linked to the Singapore price of diesel - not crude oil prices.
- The Singapore benchmark price of diesel plus shipping costs and Australian taxes represents almost the entire wholesale price of diesel - around 95% of TGPs.
- The remaining 5% of TGPs reflect insurance, local wharfage and terminal costs and a small wholesale marketing margin (where competitively possible).
- Generally, there is a short time lag of 1-2 weeks between changes in Singapore prices and changes in Australian TGPs, and this lag operates when prices are both rising and falling.
- Daily TGP data are published by all wholesale suppliers (AIP website has average TGPs - www.aip.com.au/pricing/tgp.htm).
Most diesel is sold in bulk through commercial contracts, not through retail outlets
- TGPs are typically around 95% of the diesel pump price. Apart from TGP, pump prices in Australia also reflect land transport costs, marketing and administration costs, and the costs of running service stations like wages, rent and utilities. The ability to cover these costs depends on local area competition.
- Most diesel is sold in bulk to commercial and industrial customers (eg. in mining, transport and farming) on long term contract; such contracts are subject to rigorous competition under regular market tenders.
- There is no retail discounting cycle (ie. sawtooth pattern) for diesel, as only 25% of diesel is sold through retail outlets and most of this goes to contract or fuel card customers rather than private motorists.
- The major oil companies only set retail prices at a limited number of service stations across Australia (around 8%) and these are largely in metropolitan areas.
Low sulfur diesel is a high quality fuel and delivers more kilometers per litre than petrol
- To meet the low sulfur fuel standard for Australian diesel (10ppm sulfur from 1 January 2009) requires extensive processing in the refinery to remove the sulfur from the crude oil, similar to that required for low sulfur petrol.
- Tighter diesel fuel standards are delivering dramatic reductions in vehicle emissions (including particulate emissions and black smoke), providing significant air quality improvements in major cities and towns.
- Because diesel has a higher energy content than petrol, it delivers more kilometres for each litre of fuel consumed (particularly when used in new efficient diesel engines).
Australia's highly competitive market has delivered low diesel prices by world standards
- When comparing Australian diesel prices to other countries, allowance must be made for different government taxes and tax rates and for any subsidies and road user charges (eg. in New Zealand) that don’t apply here.
- Vigorous competition in Australia also means that oil company profits are typically a very small proportion of the retail price (eg. average oil company profit over the last decade is around 1.7 cents per litre of fuel sold).