Regional Patterns for the Retail Petrol Prices

Arezoo Ghazanfari
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Arezoo Ghazanfari: School of Economics, Finance and Marketing, RMIT University, Victoria 3000, Australia

International Journal of Energy Economics and Policy, 2021, vol. 11, issue 4, 383-397

Abstract: Costs of transport fuels are the most significant components of household expenditures, and the price of petrol is of particular importance for commercial and residential sectors in Australia. Regarding the central role of petrol, an in-depth understanding of petrol price behaviours is essential. Previous studies mostly focused on the petrol markets in metropolitan areas, and there exists a significant gap in the regional literature. Therefore, this paper is aimed to develop a clearer understanding of petrol price patterns in urban and rural areas in Western Australia. This study finds a mismatch between pricing patterns across various regions and cities. There are cities with two types of price patterns, cities with price cycles and cities without. Most cities have not excessive fluctuations, and their price patterns are almost smooth. This group of cities have different levels of petrol prices. The greater distance with Perth raises petrol prices in these groups of cities. Cyclical patterns have been observed only in Murray, Mandurah and Geraldton. Comparative analysis reveals that asymmetric and frequent weekly cycles in three cities are similar to the cycle in Perth. It can be argued that there exist no specific differences in petrol price patterns among cities with cycle.

Keywords: Petrol prices; Regional markets; Markov switching models; Australia. (search for similar items in EconPapers)
JEL-codes: C22 D40 L11 Q41 R10 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eco:journ2:2021-04-45

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