{"id":408801,"date":"2026-05-02T19:44:22","date_gmt":"2026-05-02T19:44:22","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/408801\/"},"modified":"2026-05-02T19:44:22","modified_gmt":"2026-05-02T19:44:22","slug":"fuel-costs-set-to-rise-putting-pressure-on-government-to-extend-excise-cut","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/408801\/","title":{"rendered":"Fuel costs set to rise, putting pressure on government to extend excise cut"},"content":{"rendered":"

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The cost of petrol and diesel is set to climb again in coming weeks after Australia\u2019s regional oil prices hit a new wartime high, piling pressure on the federal government to extend its 26\u00a2 cut to the fuel excise beyond the June 30 deadline.<\/p>\n

Motorists have enjoyed a two-week window of relief at the pump after the US-Iran ceasefire raised hopes of an imminent end to the conflict, spurring a swift fall in crude oil and fuel prices.<\/p>\n

\"FuelFuel prices are set to rise. Louie Douvis<\/p>\n

But as a series of peace talks foundered, crushing prospects of Middle East energy exports returning to normal any time soon, benchmark oil prices have risen to their highest levels since Iran all but closed the Strait of Hormuz on February 28.<\/p>\n

On Friday, Australia\u2019s regional oil benchmark, Tapis crude, was trading at $US125 ($174) a barrel, its highest mark since the global energy crisis sparked by the war in Ukraine in 2022, and almost double the $US65 price point underpinning the Australian government\u2019s mid-year budget update.<\/p>\n

While prices dropped slightly on overseas markets overnight, international oil bosses are sounding the alarm as stockpiles run down.<\/p>\n

Related Article\"How<\/a><\/p>\n

\u201cA lot of the inventory and spare capacity has been depleted already,\u201d Chevron chief financial officer Eimear Bonner told Bloomberg. \u201cThere\u2019s very little of the buffer left.\u201d<\/p>\n

\u201cThe market hasn\u2019t seen the full impact of that yet,\u201d Exxon chief executive Darren Woods told analysts overnight. \u201cThere\u2019s more to come if the strait remains closed.\u201d<\/p>\n

\u201cMarkets are not liking what is happening in the Middle East,\u201d said Peter Khoury, a spokesman for the National Roads and Motorists Association.<\/p>\n

Prime Minister Anthony Albanese said on Friday that economic damage from the war would have a \u201clong tail to it\u201d.<\/p>\n

\u201cWe don\u2019t know when this war will end. We don\u2019t know what the consequences will be. We don\u2019t know if the Strait of Hormuz will be open, what the timeframe is …\u201d Albanese said.<\/p>\n

The prime minister has not ruled out extending the fuel excise cut beyond June, and said last month that the government would \u201cexamine it at an appropriate time\u201d.<\/p>\n

Treasurer Jim Chalmers has emphasised the role the cut has played in driving down prices since April, after a 33 per cent jump in petrol prices helped push inflation to 4.6 per cent in March.<\/p>\n

\u201cThis shows how important and how necessary that decision from the government was since we halved the fuel excise,\u201d Chalmers said on Wednesday.<\/p>\n

While Sydney and Melbourne drivers saw regular unleaded averaging $1.80 and diesel at $2.50 a litre on Friday, those figures are expected to jump within seven to 10 days as the international spike filters through to local service stations. In late March, diesel prices hit a high of $3.10 a litre, while unleaded petrol rose to $2.59 a litre.<\/p>\n

Related Article\"Viva<\/a><\/p>\n

While price spikes are imminent, pressure on the local fuel supply chain has eased.<\/p>\n

Previously unpublished government data reveals that panic buying has subsided as petrol and diesel sales have returned to typical levels, after consumption hit a high point in the first week of March.<\/p>\n

Fuel excise volumes \u2013 a key indicator of how much fuel has been sold in the nation as it is charged per litre \u2013 surged to a six-year peak in the weeks following February 28, when US President Donald Trump launched his attack on Iran.<\/p>\n

The spike was driven by a wave of panic buying as motorists and businesses braced for the risk of major price rises and supply shortfalls.<\/p>\n

However, demand has plummeted by as much as 20 per cent since early March, signalling that motorists are changing their driving behaviour.<\/p>\n

Prices have eased and supply has increased since fuel importers procured additional cargoes in March and the government secured agreements with Asian fuel exporters to shore up supply.<\/p>\n

The number of local service stations without fuel has fallen to less than half the number recorded during the first weeks of the war.<\/p>\n

Experts attribute the massive fall in fuel demand to people changing their driving behaviour to deal with higher prices, as well as the impact of increased government and industry messaging encouraging motorists to adopt fuel-saving measures, take public transport where possible and not fill up unnecessarily.<\/p>\n

\u201cI would suggest it\u2019s all of the above,\u201d the NRMA\u2019s Khoury said. \u201cSustained periods of really high prices result in people driving less, combining trips and using public transport more.\u201d<\/p>\n

Cut through the noise of federal politics with news, views and expert analysis. Subscribers can sign up to our weekly Inside Politics newsletter<\/a>. <\/p>\n

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\"MikeMike Foley<\/a> is the climate and energy correspondent for The Age and The Sydney Morning Herald.Connect via email<\/a>.\"NickNick Toscano<\/a> is a business reporter for The Age and Sydney Morning Herald.Connect via X<\/a> or email<\/a>.From our partners<\/p>\n","protected":false},"excerpt":{"rendered":"Save You have reached your maximum number of saved items. Remove items from your saved list to add…\n","protected":false},"author":2,"featured_media":408802,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[138,219,111,139,69],"class_list":["post-408801","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-new-zealand","tag-newzealand","tag-nz"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/408801","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=408801"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/408801\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/408802"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=408801"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=408801"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=408801"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}