ACT News

Costco Canberra petrol station opens, igniting price war

The opening of Canberra's Costco petrol station has fuelled a petrol price war within hours of starting its bowsers at Majura Park on Thursday morning.

Standard unleaded petrol and diesel was selling for 129.7 cents per litre and premium 98 for 139.7 cents at the Costco station when it opened its doors at 6am, after months of speculation during construction.

Its nearest competitor, Woolworths Caltex, matched the unleaded petrol price of 129.7 cents per litre - a roughly 14 cent or 10 per cent discount on previous prices - within three hours of Costco opening.

However, both stores have a catch for motorists wanting to take advantage of the prices.

Only Costco members can buy fuel at the Costco bowsers, non-members must go to Costco's warehouse next door and pay $60 if they want to sign up.

Fuel was advertised at 129.7 cents at Woolworths, but only for customers who had earned a discount on their Woolworths Everyday Rewards Card.

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Other customers were paying 133.7 cents per litre for unleaded and diesel, still a large discount on petrol offerings elsewhere in the capital.

In the first two hours about six drivers had taken advantage of the Costco prices, Costco country manager Patrick Noone said.

Mr Noone said the discounts available at Costco's 16 self-serve bowsers made its membership well worth the $60 annual fee.

"Based on today you'll save 14 cents a litre each time you fill up," he said.

"You use your membership card to validate and you use your credit card to buy the fuel, it's all self-serve at the pump.

"We just sell fuel and we sell it a great price, you don't need to get out of your car to buy candy and drinks."

Woolworths has a policy of "following" petrol prices rather than "leading", a spokesman said.

"We follow the rest of the local market as it moves, both up and down," he said.

"We also offer our customers up to an additional 8 cents a litre off their fuel when they spend $30 in our supermarkets and $5 in our service station convenience stores."

The NRMA's regional director for the ACT Alan Evans said supermarket-aligned service stations could no longer treat Canberra motorists "like mugs" now that Costco had opened.

Last week the average petrol price in Canberra was 148.8 cents per litre and diesel was 150.3 cents per litre.

He said the "dramatic" price drop to 129 cents per litre was the lowest price in five years for Canberra.

"The NRMA has been fighting for more competition in the ACT because we knew that the ultimate result would be fairer prices for local motorists. Today, we have been vindicated," he said.

"The formula for the supermarket chains now is simple – either you match these competitive prices or you'll be out of business in no time at all."

Despite the price shake-up, Canberra drivers still have a way to go before they are on par with Sydney.

On average Sydneysiders paid 127.5 cents per litre for petrol on Wednesday, according to the NRMA, and as of Thursday morning there were some stations selling petrol for as low as 119.7 cents per litre.

Costco will open from 6am to 9:30pm on weekdays, 6am to 7:30pm on Saturdays and 7am to 6pm on Sundays.

Its rival Woolworths Caltex opens 24-hours a day.

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