Treasurer Jim Chalmers has put petrol companies on notice not to profiteer after Australia\u2019s the temporary fuel tax relief expired at midnight on Sunday.<\/p>\n
Drivers can expect a price increases at the petrol pump to start flowing from Monday as the rate is also be hit with its twice yearly inflation indexation.<\/p>\n
Fuel excise was temporarily reduced on April 1 from 52.6 cents a litre to 20.6 cents a litre, a 32 cents per litre discount to wholesale fuel prices.<\/p>\n
The Albanese Government then partially extended the relief to August 2, albeit reducing the discount at the pump to 16 cents a litre.<\/p>\n
<\/p>\n
\u201cIt has played a really important role helping to take some of the sting out of the cost-of-living pressures,\u201d Treasurer Jim Chalmers said.<\/p>\n
\u201cIt was never the government\u2019s intention for that to be permanent.\u201d<\/p>\n
The massive fuel tax cut cost the budget $2.9 billion in the first three months alone.<\/p>\n
It was designed to give economic relief to Australians in response to the oil crisis caused by the closure of the Strait of Hormuz.<\/p>\n
Now in a letter to Australia\u2019s consumer watchdog, the Treasurer has asked for increased monitoring as petrol companies hike prices.<\/p>\n
\u201cSince 1 April 2026, the Government has provided substantial temporary fuel tax relief to help reduce cost-of-living pressures on Australian households and businesses,\u2019\u2019 he said.<\/p>\n
\u201cAs this relief comes to an end, the Australian Competition and Consumer Commission (ACCC) has an important role in closely monitoring retail fuel prices and promoting transparency in the fuel market.<\/p>\n
\u201cI consider it necessary that the ACCC increases scrutiny of fuel prices as fuel excise rates return to their normal settings to help ensure the change is appropriately reflected in prices paid by consumers.<\/p>\n
\u201cI therefore ask that the ACCC step up its monitoring of fuel price movements to help ensure Australian motorists can be confident that fuel markets are operating competitively and as expected. <\/p>\n
\u201cThe restoration of excise rates to normal settings cannot be used as a pretext for false, misleading or otherwise unjustified price increases.\u201d<\/p>\n
Inflation threat<\/p>\n
Last week, the Treasurer warned that the recent escalation of tensions in the Middle East poses a major threat to global inflation putting pressure on airline travel, petrol prices and interest rates.<\/p>\n
Australians are being urged not to panic-buy fuel after oil jumped to more than $US100 ($143) a barrel in recent days.<\/p>\n
In a Treasury briefing provided to the government, officials warned that red flags are emerging regarding inflation despite US President Donald Trump\u2019s claim the conflict has been won.<\/p>\n
The Treasurer took the unusual step of releasing parts of the Treasury briefing so voters could understand the challenges.<\/p>\n
He said there was no doubt that the recent escalation of tensions in the Middle East poses a substantial threat to global inflation.<\/p>\n
\u201cThere is still so much uncertainty about this war and its ongoing costs and consequences,\u2019\u2019 he said.<\/p>\n
\u201cLike the rest of the world, we are monitoring day-to-day developments very closely because so much hinges on a proper ceasefire and the permanent reopening of the Strait.<\/p>\n
\u201cFrom an economic point of view, a proper and permanent end to the war can\u2019t come soon enough.<\/p>\n
\u201cThe longer this drags out the more serious the consequences for inflation and growth here and around the world.\u201d<\/p>\n
The briefing notes said that brent crude oil prices have risen by 28 per cent since the Memorandum of Understanding (MoU) was signed by the United States and Iran and the war declared \u2018over\u2019 by US President Donald Trump this month.<\/p>\n
The challenges include Houthi rebels striking two Saudi vessels in the Red Sea this week, a key route for Saudi Arabia to send its oil overseas.<\/p>\n
\u201cThis included re-routing of exports, a drawdown in oil inventories, and some demand destruction,\u2019\u2019 the briefing notes said.<\/p>\n
\u201cThe oil market is now more vulnerable, with weaker buffers against future supply shocks.<\/p>\n
\u201cTransit through the Strait of Hormuz only briefly recovered under the MoU and has significantly reduced again following the latest outbreak in conflict.\u201d<\/p>\n
The briefing suggests that reserve releases and commercial destocking have \u201creduced the buffer available to absorb further supply disruptions.\u201d<\/p>\n
\u201cFewer flows through Hormuz mean this smaller buffer is likely being drawn down more quickly,\u2019\u2019 the briefing notes.<\/p>\n
\u201cRecent Houthi attacks on tankers in the Red Sea threaten the routes used to bypass Hormuz. Even limited attacks could disrupt flows by raising insurance costs and making shipowners less willing to transit the region.<\/p>\n
\u201cThere has been recent speculation about land-based military action by the United States. This would represent a major escalation in the conflict and increase the expected extent and duration of the disruption.\u201d<\/p>\n
Another pressure point is the fact that Ukrainian drone strikes on Russian refineries recently prompted a ban on Russian diesel exports.<\/p>\n
The briefing goes on to warn that crude oil prices are likely to remain elevated in the near-term.<\/p>\n
\u201cUpside risks to oil prices will build if the status quo persists,\u2019\u2019 the briefing warns.<\/p>\n
\u201cThe breakdown of the MoU has shown that the underlying dispute over control of the Strait of Hormuz remains unresolved, leaving the market exposed to repeated cycles of escalation and de-escalation.<\/p>\n
\u201cThis could include additional attacks on Gulf energy infrastructure or disruptions to alternative export routes like the Red Sea.\u201d<\/p>\n
The 2026-27 Budget included a downside scenario of a more severe Middle East conflict, where oil prices peak at US200 per barrel in the September quarter 2026.<\/p>\n
Under this horror scenario, inflation peaked at around 7 per cent through the year to the December quarter 2026.<\/p>\n","protected":false},"excerpt":{"rendered":"Treasurer Jim Chalmers has put petrol companies on notice not to profiteer after Australia\u2019s the temporary fuel 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