Australia: BP ‘not competitive’ on fuel price says the ACCC

In a statement of issues yesterday that raised a number of concerns over BP’s US$1.8 billion bid for Woolworths service stations, the Australian Competition & Consumer Commission (ACCC) pinpointed BP’s history of pricing above Woolworths and whether that might continue if the takeover is waved through.

Australian Competition and Consumer Commission Chairman Rod Sims said the deal could substantially reduce competition in metropolitan areas by reducing the number of rivals in the fuel market, and lessening pressure on other retailers to keep their prices low.

“As you know, in the metropolitan areas there is a definite fuel cycle. BP seems to price above Woolworths, and we need to understand how BP taking over Woolworths will affect the competition dynamic in each of those metropolitan areas,’’ ACCC chairman Rod Sims told The Australian.

“Now, it certainly seems to be the case that Woolworths is a much better influencer on the market than BP.

“How will that change of ownership affect the ­dynamic of the market? We are still working our way through that issue.”

He said Woolworths was a “very competitive player’’ and BP behaved differently through the petrol cycle.

Full Content: The Australian

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