Why supermarket fuel discounts have become an election issue

Supermarket fuel discounts have become an election campaign issue, with small retailers appealing to the next Prime Minister to crack down on what they regard as unfair competition.

But Coles and Woolworths insist competition is good, and everyone benefits from cheaper petrol.

"We've seen 16 percent of the service station independent service stations across the country close down, that's 1000 sites in the last four years," the Australasian Convenience and Petroleum Marketers Association's Nic Moulis said.

Against the big two, Coles and Woolworths, and their fuel dockets offer discounts of up to 45 cents a litre.

"These small independent retailers are finding it tough out in the market place to compete," Russell Zimmerman from Independent Retailers of Australia said.

Today, the little guys hit back, with full page ads calling on both political leaders to intervene.

They accused the supermarket chains of a: "misuse of their ever increasing power."

And if it continues, Nic Moulis said that: "[If] we lose all the independents [and] then those retailers can screw up their prices and then the consumer will pay in the long term."

Coles and Woolworths are making no apologies about their docket systems.

They say it is about better prices for consumers, and they reject the view that smaller operators are suffering.

"This is a workable competitive market and it's shoppers that are getting the benefit," the Retailers Association's Margy Osmond said.

Fuel dockets are currently being reviewed by competition watchdog the ACCC.