The Federal Government is concerned rural motorists are not enjoying the benefits of plunging global oil prices.

As pump prices in some areas of Sydney drop to a five year low of around $1 a litre, motorists outside capital cities are paying an average $131.4.

Small business minister, Bruce Billson, says the disparity has prompted concern from rural and regional residents about the “mysteries” of fuel pricing.

Billson said tumbling pump prices were good news for most motorists.

“However it seems curious to me that many Australians in rural areas are not yet reaping the benefits of these low prices,” he said in a statement on Wednesday.

Competitive pressures alone were not sufficient to ensure efficient pricing and the protection of consumers in all retail fuel markets.

Billson wants motorists to raise their concerns with the consumer watchdog.

The Australian Competition and Consumer Commission has been directed by the minister to monitor the prices, costs and profits of the petroleum industry for the next three years.

Monitoring reports will now be produced quarterly rather than annually.

The commission will also be able to look at specific regions, targeting perceived irregularities in the fuel market or market dysfunction.

The ACT government has asked the commission to review its market where petrol prices on average are up to 15 cents higher than the major capital city average.

NATIONAL RETAIL PRICES (week ending Sunday January 4, 2015)

* National average 121.9 cents per litre (down 2.3 cents on the previous week)

* Metropolitan average 117 cents (-2.2 cents)

* Major capital city average 116.3 cents (-2 cents)

* Regional average 131.4 cents (-2.3 cents).

(Source: Australian Institute of Petroleum)

AAP