$1.60 a litre: Petrol to drop, price gougers on notice

The ACCC will be keeping a close eye on petrol stations to make sure they are passing on savings to customers. (Source: Getty)

Over the next few weeks, motorists should see petrol prices drop back well below $2 a litre as wholesale oil prices drop and cuts to the fuel excise tax start flowing through to the pump.

With wholesale oil prices currently sitting at $1.60 a litre, NRMA spokesperson Peter Khoury said the average price on unleaded “wouldn’t be far off” this number once the fuel excise tax cuts were also passed on.

Oil prices have fallen consistently over the last few weeks from record highs in early March, he said, and servos were already starting to replenish their stocks and pass on those savings.

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“We're now seeing most of the capital cities, almost all of them, [with fuel] under $2 a litre,” he said

Khoury said once the fuel tax cuts kick in fully in a few weeks, prices well above the $1.60 a litre mark for unleaded and $1.80 a litre for diesel could suggest the retailer is not transferring the discounts to customers.

“It is absolutely critical that oil companies pass on both the cuts to the excise and the falls in the oil prices and not just substitute one with the other,” he warned.

The Australian Competition and Consumer Commission (ACCC) is responsible for making sure the tax cuts are passed onto the customer and not withheld by the retailer.

“If retailers make false or misleading statements to consumers that they have passed on the savings when they have not, the ACCC will not hesitate to take appropriate enforcement action,” ACCC chair Gina Cass-Gottlieb said earlier this week.

Khoury noted that fuel prices aren’t regulated in Australia and the ACCC’s powers are limited to “naming and shaming” companies found to be consistently overcharging.

Fuel excise tax halved

The Federal Government halved the fuel excise tax for six months in the 2022 Budget to reduce the cost of petrol for Australian motorists.

This means the amount of tax drivers pay to fill up has been cut to 22.1 cents a litre, from 44 cents per litre.

“A family with 2 cars who fill up once a week could save around $30 a week or around $700 over the next 6 months,” Treasurer Josh Frydenberg said in his budget speech.

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