Association senior vice-president Rob Anderson said the Australian Competition and Consumer Commission (ACCC) must monitor more closely the pricing structure of regional fuel suppliers.

"Petrol prices in Sydney are around 105 cents per litre (cpl) yet prices in regional areas are 10 per cent higher or more," Mr Anderson said. "

"Diesel is even worse! Why is the cost of diesel higher than petrol even though they cost the same amount to produce?

"We pay up to $1.30 for diesel in the bush, that's a 10 per cent increase on the already inflated prices for diesel in the city."

The Association believes that fuel companies abuse their market power and are taking advantage of the limited number of suppliers in regional areas.

"The ACCC must take more action to penalise oil companies that abuse their market power," Mr Anderson said.

"This must be done now,"