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Analyzing different types of asymmetric responses in terminal gate prices of petrol and diesel across major Australian seaports: Implications for fuel price monitoring strategies

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  • Valadkhani, Abbas

Abstract

This paper examines the sign and size-dependent asymmetry in wholesale petrol and diesel prices in the long and short run across seven major distribution centres in Australia using daily data from 1 January 2004 to 18 November 2022. This study adopts a composite threshold mean model that is augmented with an asymmetric power autoregressive conditional heteroskedasticity (APARCH) model or an exponential general autoregressive conditional heteroskedastic (EGARCH) model to capture volatility clustering in high-frequency data. Inter alia, the results reveal that the long-run (adjustment) asymmetry is more widespread for unleaded petrol prices than diesel prices. Melbourne and Perth are the only two outport terminals that do not exhibit short- or long-run asymmetry for both diesel and petrol. In terms of the adjustment asymmetry, terminal gate prices for petrol in Darwin, Hobart, and Sydney are the least competitive, whereas the opposite is true for Adelaide, Brisbane, and Perth.

Suggested Citation

  • Valadkhani, Abbas, 2023. "Analyzing different types of asymmetric responses in terminal gate prices of petrol and diesel across major Australian seaports: Implications for fuel price monitoring strategies," Energy Economics, Elsevier, vol. 122(C).
    • Handle: RePEc:eee:eneeco:v:122:y:2023:i:c:s0140988323002074
    DOI: 10.1016/j.eneco.2023.106709
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    More about this item

    Keywords

    Diesel; petrol; gasoline; Gasoil; wholesale prices; Asymmetry; Australia;
    All these keywords.

    JEL classification:

    • C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models; Switching Regression Models; Threshold Regression Models
    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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