Motorists are enjoying cheaper petrol prices but they are not as low as the competition watchdog expected, due to high refinery and retail margins.
The average prices at the pump fell 8.8 cents to 124.4 cents a litre during the three months to December 31, according to the Australian Competition and Consumer Commission (ACCC).
The annual average retail price for 2015 was 128.1 cents a litre, 18.3 cents lower than in 2014.
But the watchdog says the price wasn't as low as expected given that crude oil prices dropped to an 11-year low as global oil supply outstripped demand.
ACCC chairman Rod Sims says high retail margins and high refiner margins, the difference between crude oil prices and international refined petrol prices, are to blame.
"As global demand for petrol was relatively strong in 2015, prices remained high relative to crude oil prices," he said.
"These high refiner margins are outside Australian control."
However, he said the retail prices were also unreasonably high in the second half of the year.
The watchdog wrote a "please explain" letter to major petrol retailers in early February and expects to receive responses shortly.
The ACCC's report said Brisbane continued to have dearer petrol than the other four major cities: Sydney, Melbourne, Perth and Adelaide.
"Since July 2009, annual average retail petrol prices in Brisbane have been consistently above those in the other four larger cities," it said.
"Given that wholesale prices, or terminal gate prices, are broadly the same ... and transport costs in Brisbane are likely to be similar to the other cities, the high relative retail prices in Brisbane are likely to reflect factors at the retail level."
MONTHLY AVERAGE PETROL PRICES IN DECEMBER QUARTER:
Sydney - 117.5 cents a litre from 130.1 in Sept quarter
Melbourne - 121.5 from 127.6
Brisbane - 124.3 from 130.6
Adelaide - 120.8 from 129.0
Perth - 123.6 from 129.3
Hobart - 133.5 from 137.8
Canberra - 127.2 from 132.8
Darwin - 126.6 from 130.4
(Source: ACCC)
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