Petrol prices to skyrocket as fuel excise cut ends NRMA warns already too high

Fill up NOW: Urgent warning is issued to Australians that fuel prices will soar TONIGHT – here’s how much you will be paying just to fill up

  • Petrol price will surge from 11.59pm on Wednesday night as tax relief stops 
  • NRMA warns Australians are already paying too much for fuel at the bowser 
  • It comes as price of fuel is likely to reach more than $2-a-litre in the next week  

Australians are being warned petrol prices at the pump are set to skyrocket even further despite global oil prices falling, a leading motoring group warns.

The NRMA has called on fuel companies to cut prices as regular unleaded topped an average of $1.90-a-litre in Sydney, Melbourne and Brisbane this week.

The government’s fuel excise reduction ends at 11.59 pm Wednesday, which will push prices up by another 25c-a-litre just in time for the October long weekend.

‘Despite falling global prices and the full fuel excise tax not yet reinstated, prices are approaching $2-per-litre, meaning motorists are paying much more for fuel than they should be,’ NRMA spokesperson Peter Khoury said.

Fuel prices in major cities could rise to more than $2-a-litre in the next week (file image)

Once the fuel excise hike takes effect, drivers could be paying near the same amount at the pump they were earlier this year when prices soared after Russia’s invasion of Ukraine.

The NRMA said it was ‘concerned’ about a 42c-a-litre gap between wholesale and retail petrol prices in Sydney, the highest margin since May 2020. 


Adelaide 188.7c

Brisbane 193.4c 

Canberra 177.8c

Darwin 170c

Hobart 171.1c

Melbourne 193.7c

Perth 155.8c

Sydney 190.3c

Source: NRMA for September 27 

‘Prices today are already unacceptably high, and we need to see a correction immediately,’ Mr Khoury said.

He pointed to the prices being in stark contrast to the global trend of plunging oil prices after a high point earlier this year, amid sanctions on Russian oil.

‘It was $160 a barrel and has now dropped by $60 over a couple of months to $100 a barrel,’ he said.

‘Australians are already battling cost of living pressures. Let’s hope more restraint (from retailers) is shown after the reintroduction of the excise than what we’ve seen this week.’

The former Morrison Government halved the fuel excise from 44.2c to 22.1c-a-litre in March for six months as prices skyrocketed, but new Prime Minister Anthony Albanese’s Labor government has declined to extend the relief.

Mr Khoury said GST would add another 3c-a-litre to the cost, pushing prices back up by 25c-a-litre at the bowser.

‘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.’

Australians will be paying more at the fuel pump by October as the temporary cut on the fuel tax finishes (file image)

Australians will be paying more at the fuel pump by October as the temporary cut on the fuel tax finishes (file image)

Federal Treasurer Jim Chalmers said last week there was ‘no reason’ for service stations to ‘jack up their prices’ on the same night the excise went 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,’ Dr Chalmers said.

‘We don’t want service stations to treat Australians like mugs so we’re watching this closely.’

Dr Chalmers vowed that the Australian Competition and Consumer Commission would be on the lookout for price gouging.

‘The reason that we’ve maximised the ACCC’s role in all of this is we want to make sure there’s not dodgy behaviour going on,’ he said.

Federal Treasurer Jim Chalmers (pictured) said last week there was 700million litres of fuel stored at the cheaper price so retailers shouldn't 'jack up' their prices too quickly

Federal Treasurer Jim Chalmers (pictured) said last week there was 700million litres of fuel stored at the cheaper price so retailers shouldn’t ‘jack up’ their prices too quickly 

‘We’ve been working closely with the servos and suppliers to understand that there are hundreds of millions of litres of fuel underground in tanks that was purchased at the lower price.’

‘So the ACCC and the government expect that the price of petrol shouldn’t shoot up at the bowser on Wednesday night by the full 23 cents if the normal market pressures are in operation.’

He added it was a ‘difficult decision’ to not extend the fuel tax relief but the government was focused on ‘responsible budgeting’. 

Some economists criticised the fuel tax relief when it was introduced by former treasurer Josh Frydenberg in the pre-election March budget, citing the huge loss in revenue, estimated at $3billion 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.