WA government rules out petrol price cap as fuel costs soar amid Middle East war

The WA government has ruled out using its unique power to temporarily cap the price of petrol to stop gouging from retailers, as leaders held an urgent meeting to discuss exorbitant hikes in the cost of fuel amid the Middle East war.

The cost of unleaded petrol in Perth has risen by 63.4 cents per litre in just a week amid massive volatility in the global oil price since US and Israeli strikes on Iran ignited war on February 28.

Motorists were paying an average of $2.27 per litre on Wednesday, with some fuel stations charging up to $2.45.

The WA government has urged motorists to "shop around" for cheaper fuel, maintaining there are no direct impacts to supply as a result of the war and blaming the increased demand on panic buying.

Premier Roger Cook said the government would "do what it takes" to minimise the impact of the hikes. 

He was speaking as key government ministers held an urgent meeting on Wednesday with representatives from the farming, commercial airlines and fuel industries.

No price cap

Following the roundtable, Premier Cook said a price cap would not be implemented. 

In WA, a unique law allows the state government to enforce price fixing measures to prevent gouging from fuel retailers.

Premier Cook said the laws were passed in a "bygone era" when muster stations were abusing their position in the fuel market.

"I think it was unanimous in the room that we don't need price caps but we do need calm," he said after the meeting.

He also revealed measures the state government will take to address concerns around fuel supply.

They include prioritising fuel and fertiliser imports through WA's ports and the timely restocking of fuel in regional WA.

A new industry operational group will also meet weekly to manage domestic supply chain issues as they arise.

"It was an important meeting because what it did is bring people together," he said.

Price controls on fuel have not been implemented since WA's fuel price comparison website FuelWatch was launched in 2001.

'Shop around'

Attorney General Tony Buti said the best way for motorists to avoid high pricing is to "shop around", but said there was "no evidence" of price gouging.

He noted some regional towns were selling fuel cheaper than Perth on Wednesday.

But the situation was impacting farmers.

Kojonup farmer Gordon Coleman said he purchased a 20,000 litre fuel tank during the pandemic but has been told, just two weeks from his planned seeding this year, he could only acquire 10 per cent of that capacity from his supplier.

"They're [the government] saying there's no shortage, no issues, whereas the reality that we're seeing for several days now is the opposite," he said.

"We're being told from our suppliers from above them that there are restrictions on what they're getting."

Amy Dyer said operations at her mixed crop and sheep farm near Manjimup have been disrupted due to diesel supply uncertainty.

"The big decision that we are having to make, along with everyone else, is whether or not we go ahead with seeding," she said.

For Carnarvon citrus and vegetable grower Tam Chinnery, high fuel prices are adding to what's already been a challenging season, where her farm has suffered losses due to heatwaves and a cyclone.

She said if price hikes aren't passed onto consumers, she will simply be forced to stop growing.

"Fuel prices are another whammy after a bit of a shocking summer," Ms Chinnery said.

Opposition wants clarity

Opposition Leader Basil Zempilas urged Mr Cook to "come clean" on the extent of the problem and what action the government is considering.

"Tell us the situation — what are our fuel supplies like, are we in danger of running out?" Mr Zempilas said.

"If we are in danger of running out, or need to ration fuel, how is that going to be managed?"