❓ Mr Trenorden questions the Minister about high fuel prices in regional WA despite the introduction of a maximum wholesale price regime, alleging harm to small operators. The Minister acknowledges the issue, outlines steps taken, and points to external factors and past government decisions.
AnsweredQoN 568Legislative Assembly
QuestionView source ↗
FUEL PRICES, PRICING REGULATIONS
I refer to today’s maximum wholesale spot price for unleaded fuel of 75.42c a litre compared with the average price in Geraldton of 92c a litre and in Merredin of 89c a litre. (1) Does the minister acknowledge that no fuel has been brought under the maximum wholesale price regime since it was introduced months ago? (2) Does the minister recognise that the current pricing regulations are harming small, independent operators, particularly in country areas? (3) Will the minister reconvene the petroleum products advisory committee? Mr KOBELKE
I refer to today’s maximum wholesale spot price for unleaded fuel of 75.42c a litre compared with the average price in Geraldton of 92c a litre and in Merredin of 89c a litre. (1) Does the minister acknowledge that no fuel has been brought under the maximum wholesale price regime since it was introduced months ago? (2) Does the minister recognise that the current pricing regulations are harming small, independent operators, particularly in country areas? (3) Will the minister reconvene the petroleum products advisory committee? Mr KOBELKE
AnswerView source ↗
(1)-(3) I will answer the last question first. I have written to a number of people asking them to form that committee. I hope it will have its first meeting in the near future. The Act allows for the minister to appoint that committee from time to time. The last committee lapsed and I have now appointed a new committee, which will provide advice on a range of matters. Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
(1) Does the minister acknowledge that no fuel has been brought under the maximum wholesale price regime since it was introduced months ago? (2) Does the minister recognise that the current pricing regulations are harming small, independent operators, particularly in country areas? (3) Will the minister reconvene the petroleum products advisory committee? Mr KOBELKE replied: (1)-(3) I will answer the last question first. I have written to a number of people asking them to form that committee. I hope it will have its first meeting in the near future. The Act allows for the minister to appoint that committee from time to time. The last committee lapsed and I have now appointed a new committee, which will provide advice on a range of matters. Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
(2) Does the minister recognise that the current pricing regulations are harming small, independent operators, particularly in country areas? (3) Will the minister reconvene the petroleum products advisory committee? Mr KOBELKE replied: (1)-(3) I will answer the last question first. I have written to a number of people asking them to form that committee. I hope it will have its first meeting in the near future. The Act allows for the minister to appoint that committee from time to time. The last committee lapsed and I have now appointed a new committee, which will provide advice on a range of matters. Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
(3) Will the minister reconvene the petroleum products advisory committee? Mr KOBELKE replied: (1)-(3) I will answer the last question first. I have written to a number of people asking them to form that committee. I hope it will have its first meeting in the near future. The Act allows for the minister to appoint that committee from time to time. The last committee lapsed and I have now appointed a new committee, which will provide advice on a range of matters. Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Mr KOBELKE replied: (1)-(3) I will answer the last question first. I have written to a number of people asking them to form that committee. I hope it will have its first meeting in the near future. The Act allows for the minister to appoint that committee from time to time. The last committee lapsed and I have now appointed a new committee, which will provide advice on a range of matters. Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
(1)-(3) I will answer the last question first. I have written to a number of people asking them to form that committee. I hope it will have its first meeting in the near future. The Act allows for the minister to appoint that committee from time to time. The last committee lapsed and I have now appointed a new committee, which will provide advice on a range of matters. Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
(1) Does the minister acknowledge that no fuel has been brought under the maximum wholesale price regime since it was introduced months ago? (2) Does the minister recognise that the current pricing regulations are harming small, independent operators, particularly in country areas? (3) Will the minister reconvene the petroleum products advisory committee? Mr KOBELKE replied: (1)-(3) I will answer the last question first. I have written to a number of people asking them to form that committee. I hope it will have its first meeting in the near future. The Act allows for the minister to appoint that committee from time to time. The last committee lapsed and I have now appointed a new committee, which will provide advice on a range of matters. Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
(2) Does the minister recognise that the current pricing regulations are harming small, independent operators, particularly in country areas? (3) Will the minister reconvene the petroleum products advisory committee? Mr KOBELKE replied: (1)-(3) I will answer the last question first. I have written to a number of people asking them to form that committee. I hope it will have its first meeting in the near future. The Act allows for the minister to appoint that committee from time to time. The last committee lapsed and I have now appointed a new committee, which will provide advice on a range of matters. Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
(3) Will the minister reconvene the petroleum products advisory committee? Mr KOBELKE replied: (1)-(3) I will answer the last question first. I have written to a number of people asking them to form that committee. I hope it will have its first meeting in the near future. The Act allows for the minister to appoint that committee from time to time. The last committee lapsed and I have now appointed a new committee, which will provide advice on a range of matters. Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Mr KOBELKE replied: (1)-(3) I will answer the last question first. I have written to a number of people asking them to form that committee. I hope it will have its first meeting in the near future. The Act allows for the minister to appoint that committee from time to time. The last committee lapsed and I have now appointed a new committee, which will provide advice on a range of matters. Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
(1)-(3) I will answer the last question first. I have written to a number of people asking them to form that committee. I hope it will have its first meeting in the near future. The Act allows for the minister to appoint that committee from time to time. The last committee lapsed and I have now appointed a new committee, which will provide advice on a range of matters. Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Mr Trenorden: Who is on it? Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Mr KOBELKE: The letters have gone out to those people. I expect that in the next few days I will announce the people whom I have invited to be members of that committee. The member for Avon will find good country representation on that committee. Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Fuel is being made available at or below the maximum wholesale price. That does not mean that the point the member made in his question is not also true; that is, that may be done under long-term supply contracts and not necessarily on spot purchases. I have no knowledge of spot purchases that are below the maximum wholesale price, although I know that companies have been getting that. We have found that although the differential is still way too high in some areas, since we brought in the whole process of regulation, there has been a marked reduction in the differential in some regional centres and in Perth. The difficulty is that we have huge fluctuations that are driven by the exchange rate of the dollar and the international price of oil. That has come down, which has led to a drop in fuel prices in Perth. The drop in fuel prices in country areas has not been the same. There has been a lag there. That lag has exacerbated the unacceptable difference in price between Perth and regional centres. The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
The data shows that the regulatory process is matching or bettering the other capital cities in the price of fuel, so that part of the policy is working. I accept that we still have a long way to go in the other part of the policy, which concerns regional centres. We have had a few wins. The signboards in Albany indicate that the differential has dropped by 2c a litre. The price in Bunbury has come down quite considerably, and reduced the differential. In other areas we have a long way to go. However, we have not yet fully implemented the process. We are waiting to ensure that the maximum wholesale price is working. On that basis we will put in place the cap on the retail price in regional centres. However, to do that without ensuring everything else is in place would put in jeopardy many businesses in regional centres. We need to follow through on that. Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Mr Graham: What about the ones owned by the major oil companies? Put the little ones in regional centres to one side and cap the price of the majors. Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
Mr KOBELKE: That is an interesting proposition, but we would have difficulty capping one company and not another. Even if we could do that legally, the oil companies would find a way around it. They could set up supposed independents that they could control. It is not as easily done as the member for Pilbara implies. The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
The other looming problem, which I will allude to quickly, is that the previous Government, of which the Leader of the National Party was a member, committed to fuel specifications with the aim of saying it was doing something about the environment. The former Government was under a lot of pressure over its forest policy, so it grabbed at this. Of itself, that was a good thing, but it did not put it together in a way that protected motorists in Western Australia. That is because it did not get BP Australia Ltd to commit to a supply agreement. Let us take the situation with methyl tertiary butyl ether. We now have a level of 0.1 per cent MTBEs in fuel specifications in Western Australia. The rest of Australia has not even come up to the national figure that will be implemented in a couple of years, which is one per cent. In Europe, under Euro III, in order to ensure that fuel burns cleanly and there is less pollution, it is 10 per cent; not 0.1 per cent. The best scientific measures available cannot measure 0.1 per cent. BP now has a monopoly, and it has now decided to sell a lot of its products into the west coast of the United States. The threat is that there will be fuel shortages and fuel price increases in Western Australia because of that failure of supply. We are looking at that issue. It is not easily resolved. We respect the need to look after the environment, but we also need to ensure that we have the supplies required at a price required. We are seeking more international information through consultants, but initial indications are that, if we have to meet 0.1 per cent MTBE sourced out of refineries in Asia, it will add a factor of 5c a litre to the fuel price. That is because those refineries will have to gear up specially. If we go to the national figure of one per cent MTBE, that will add 3c a litre to fuel landed in Perth. When that gets to the bush it will increase the differential even further. The Government is looking at that issue, and I am confident that in time we will resolve it so that we can guarantee supplies of fuel to motorists in Western Australia at a competitive price.
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