Petrol prices are about to skyrocket again after fuel tax cat expires – here’s how bad it could get
- The temporary 22c per litre discount on fuel tax ends at 11.59pm September 28
- Service stations expected to pass the increase on to customers at the bowser
- But Treasurer Jim Chalmers said 700 million litres of the cheaper fuel is stored
- He warned service stations not to ‘jack up’ their prices immediately
- Six month discount was brought in to battle soaring petrol prices in early 2022
But drivers should be spared the financial pain of the astronomical prices seen earlier this year when the Russian invasion of Ukraine began.
Consumers should expect to see prices increase within days after the fuel excise cut ends at 11.59pm on September 28, NRMA’s Peter Khoury told Daily Mail Australia.
The Morrison Government halved the fuel excise from 44.2c to 22c-a-litre in March for six months as prices skyrocketed.
Mr Khoury said GST would add another 3c-a-litre to the cost, pushing prices back up by 25c-a-litre at the bowser.
Australians will be paying more at the fuel pump by October as the temporary cut on the fuel tax finishes (file image)
‘The excise is added at the wholesale level so we won’t see an increase immediately, retailers need to buy more stock and pass on the hike to customers,’ he said.
‘It depends on how quickly retailers sell what they have, which could be a few days or up to two weeks.
‘Urban areas will go through their product quicker and regional areas will follow.’
Going on Monday’s petrol prices, to fill up an unleaded car with a 60-litre fuel tank the cost would, on average, rise from about $98.40 in Sydney to $113.40.
In Melbourne it would go from about $99 to $114 and in Brisbane from about $103.80 to $118.80.
NRMA’s Peter Khoury said while prices will rise they shouldn’t reach the levels seen in early to mid 2022 (file image)
AVERAGE UNLEADED FUEL PRICES
Sydney 164.8c per litre
Melbourne 165.2c per litre
Brisbane 173.3c per litre
Adelaide 152.2c per litre
Perth 155.5c per litre
Hobart 171.5c per litre
Darwin 174.7c per litre
Canberra 178.3c per litre
Source: MotorMouth on September 19.
Mr Khoury said the consumer watchdog, the ACCC, would be closely watching petrol prices to ensure retailers didn’t increase prices too early and by too much.
Federal Treasurer Jim Chalmers said on Tuesday there was ‘no reason’ for service stations to ‘jack up their prices’ on the same night the excise goes back up.
He pointed to 700 million litres of fuel stored around the country that was bought at the lower price.
‘Prices don’t need to jump up immediately. We don’t want service stations to treat Australians like mugs so we’re watching this closely,’ he said.
Mr Khoury said it was a ‘difficult decision’ to not extend the tax cut but his focus was on ‘responsible budgeting’.
‘We’re under no illusions it will be difficult for people (but) I think most people understand that the budget can’t afford to keep the excise cut going forever,’ he said.
Mr Khoury said prices would rise but they shouldn’t reach the levels seen earlier this year when fuel rose to more than $2.20-a-litre.
Federal Treasurer Jim Chalmers (pictured) said on Tuesday there was 700million litres of fuel stored at the cheaper price so retailers shouldn’t ‘jack up’ their prices too quickly
‘There’s been a positive trend with the international benchmark price,’ he said.
‘It was $160 a barrel and has now dropped by 60 dollars over a couple months to $100 a barrel.’
‘What pushed the prices up was global supply being affected by Covid supply chain issues along with Russia’s invasion of Ukraine and the associated sanctions on Russian oil.
‘There no shortage of fuel for Australia it’s just expensive, the market is volatile but those spikes earlier this year came down pretty quickly.’
Some economists criticised the fuel tax relief when it was introduced in the federal government’s budget citing the huge loss in revenue, estimated at $3 billion by Treasury.
The temporary fuel excise cut
The fuel excise tax was halved from 12.01am on March 30 as part of the previous government’s budget.
The excise and excise equivalent customs duty (excise) rates for petrol, diesel and all other fuel and petroleum based products, except aviation fuels, was halved for six months.
For petrol and diesel, the rates were reduced from 44.2c to 22.1c per litre.
The halving of fuel excise rates will end at 11.59pm on September 28.