Why Fuel Prices Are More Expensive Than Ever And What You Can Do About It

Fuel is at its highest prices since before the fuel excise was cut in March.

fuel prices

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Remember back in March when the Morrison Government halved the fuel excise to give us all a bit of relief from the rising cost of petrol?

Well, I regret to inform you that fuel prices are back above $2.20 per litre, and the fuel excise hasn’t even been reinstated yet.

The fuel excise being halved immediately cut 22c per litre off the price of petrol, which was a breath of fresh air back in March, but a little over two months later, fuel prices are out the wazoo once again and there is no end in sight. As it currently stands, fuel prices, power prices, gas prices and the price of essential household items are all skyrocketing, with economists warning that the rest of the year is going to be really tough.

“For households, the six months ahead are going to feel tougher than the six months we have just had,” EY chief economist Cherelle Murphy told The Australian.

If it weren’t for the current cut to the fuel excise, you’d be looking at paying approximately $2.50 per litre for petrol right now, which feels like daylight robbery. But that could soon become a reality after Deputy Prime Minister Richard Marles confirmed that the new Labor government has no plans to extend the temporary fuel excise cut.

“We’ve made our position clear and it is not our intention to change that [temporary cut],” said Marles on Sunrise last week.

This isn’t particularly surprising considering it was always designed as a temporary measure, and the fuel excise is used to build and maintain roads, so it’s pretty important that we continue to tax fuel.

Why Is Fuel So Expensive Again?

Fuel prices are back at their highest level since the fuel excise was cut back in March. This is partly due to Russia’s ongoing invasion of Ukraine, as well as the declining value of the Australian dollar.

Even economists can’t really give a conclusive answer as to why the prices are continuing to skyrocket.

“We’re, of course, seeing general supply chain disruptions, which affect things like petrol refining, but it’s not obvious that they’re worse than they were a couple of months ago,” University of Queensland economics professor John Quiggin told the ABC, adding that it’s “hard to give a convincing explanation”.

He also suggested that petrol retailers may be trying to recoup some profits and that savings may not be being passed on to consumers. However, the  Australasian Convenience and Petroleum Marketers Association — the governing body for service stations — has refuted this claim.

How Can I Save A Few Bucks On Fuel?

There’s virtually nothing we can do right now to make fuel cheaper, but there are a few ways you can make smarter choices to save a few bucks. Sure, you’ll still be spending ridiculous amounts of money on your car, but it might sting a little less than it otherwise would.

Follow The Price Cycle

Keep an eye on your fuel gauge and only buy fuel when it’s at its lowest point in the cycle wherever possible. You can find out more information on fuel price cycles on the ACCC website.

Shop Around

Use a fuel app to find the cheapest fuel in your area because, in some instances, this can save you 10c per litre or more when you’re filling up.

For example, the RACV website in Victoria shows fuel prices across the state, as well as general information about the highest, lowest and average prices, as well as trends. New South Wales has its own fuel check website, which gives you the average price in your area at any given time.

Alternatively, there are crowdsourced apps and websites like Petrol Spy, which give price updates at different stations. However, these websites are based on user-submitted information and generally aren’t as accurate as those with access to government databases.

Fuel Lock

Using an app like the 7-Eleven fuel lock will allow you to lock in the best price in your area and fill up at that price at any 7-Eleven store within the next seven days. The catch here is that 7-Eleven may not be the cheapest option in your area, so it’s still worth comparing these prices with other retailers to avoid paying more than you absolutely have to.

Avoid Short Trips

It may seem like driving shorter distances will save you money, but you actually use 20 percent more fuel when your engine is cold, so batching all of your driving at once — if possible — can save you some money by allowing you to fill up less.

Keep Your Car Maintained

Given the ongoing cost of living crisis we’re struggling through right now, the thought of servicing your car is probably the last thing on your priority list but ensuring your car is serviced and has the correct tyre pressure can keep your car running more efficiently and save you money in the long run.

Take The Excess Stuff Out Of Your Car

This one may seem obvious, but if you’ve been driving around with a drumkit or something super heavy in the back of your car, you could be burning more fuel than you need to. Emptying your car to be as light as possible can also save you a buck.