PASSWORD RESET

Magazine of Socialist Action in Australia

The spin and profit on petrol price rises

Nationalise the oil companies!

The last few weeks have seen the first price rises as a direct result of increased petrol prices. Over the next few weeks almost all services and goods will rise in price. These basic goods and services affect working families already living on low wages.

There has been spin, and just plain lies, told in recent weeks over petrol price rises. John Howard is saying these price rises are not inflationary. Inflation is simply a rise in the cost of goods! The ALP is calling on the Australian Competition and Consumer Commission (ACCC) to investigate the oil companies for rorting the public.

In response the chairman of the ACCC Graeme Samuel is arguing that this is not the function of the ACCC! What is the role of this organisation if not investigating competition and pricing? The ACTU has calculated that, on average, families are spending an extra $20 a week on petrol; this figure will multiply by the time the other rises are accounted for.

At the same time international oil companies, which earned so much money in 2004 – the 10 largest companies had sales of more than US$1 trillion, with profits of more than US$100 billion – that they can’t find enough places to invest it.

Caltex is the largest refiner of crude oil in Australia. Caltex alone made a net profit on a replacement cost of sales basis, which removes the effect of world oil price movements, of A$149.6 million in the six months ending June 30th 2005. Overall the oil companies internationally and in Australia are making huge profits!

Unions such as the CFMEU are correctly arguing that the employers should increase wages to offset the increase in goods and services. There does need to be an investigation to the oil and distribution companies in Australia and if they are found to be making excessive profits, which they clearly admit to making, they should be nationalised.

Taking these hand full of companies into public ownership could provide not only much reduced petrol at the pump but plan huge investment into industry and services creating jobs and improved services such as education and health as well as tackling worsening environmental problems.

Nationalising these huge profit-making companies now needs to be seriously addressed by the labour movement. You can not control what you do not own and no amount of investigation into obscene profit making can stop these companies continuing to rip Australians off.

Editorial from the November 2005 issue of ‘The Socialist’