Australian motorists are bracing for higher costs at the bowser as the temporary fuel excise cut officially comes to an end tonight. The move, which was introduced as a cost-of-living relief measure, will see petrol prices jump immediately, adding fresh pressure on household budgets already stretched by inflation.

What’s Changing at the Pump?

The federal government’s decision to halve the fuel excise was a temporary reprieve for drivers, but that relief is now over. As of midnight, the full excise rate is reinstated, meaning the wholesale price of petrol will rise by roughly 22 cents per litre, though the final retail impact could vary depending on competition and location.

According to the Australian Competition and Consumer Commission (ACCC), the excise cut was passed on in full to consumers at most service stations. With the cut reversed, experts expect the increase to be reflected at the pump almost immediately, with some regional areas potentially seeing even larger spikes due to transport costs.

Why Did the Government Cut the Excise?

The fuel excise cut was introduced earlier this year as part of a broader package to ease the rising cost of living. The temporary measure was meant to provide immediate relief to families and businesses reliant on road transport, but it was always scheduled to expire after a set period.

Now that the cut has ended, the full excise will be applied again, adding revenue back to government coffers but leaving drivers to absorb the extra cost. The move has sparked debate, with some calling for a permanent reduction and others warning of the budgetary implications.

How Much More Will You Pay?

The exact increase will vary, but based on the excise restoration, drivers can expect to pay around 22 cents more per litre for petrol and diesel. For a typical 50-litre tank, that translates to an extra $11 per fill-up — a significant hit for those who commute daily or rely on their vehicle for work.

Some fuel retailers may choose to absorb part of the increase temporarily to remain competitive, but this is unlikely to last. Industry analysts suggest that prices will settle at a new, higher level within days, reflecting the full reinstatement of the excise.

Impact on Households and Businesses

The end of the fuel excise cut comes at a time when Australian households are already grappling with rising grocery prices, higher interest rates, and elevated energy costs. For small businesses, particularly those in logistics and delivery, the increased fuel costs could translate into higher prices for goods and services.

Transport operators have warned that the additional cost will inevitably be passed on to consumers, potentially fueling further inflationary pressures. This creates a tricky situation for the Reserve Bank of Australia, which is already working to bring inflation back to its target range.

What Can Drivers Do to Soften the Blow?

  • Shop around: Fuel prices can vary significantly between stations, so using apps like FuelCheck (NSW) or similar services can help you find the cheapest option in your area.
  • Drive efficiently: Smooth acceleration, maintaining steady speeds, and reducing unnecessary idling can improve fuel economy and save money.
  • Consider carpooling or public transport: Sharing rides or switching to public transport, even a few days a week, can reduce your overall fuel spend.
  • Plan your trips: Combine errands into a single round trip to minimize distance traveled.

While these tips won’t eliminate the price hike, they can help mitigate the impact on your weekly budget.

Key Takeaways

  • The temporary fuel excise cut ends tonight, with petrol prices set to rise by around 22 cents per litre.
  • The full excise is reinstated, adding approximately $11 to the cost of a typical 50-litre fill-up.
  • Businesses and households will feel the pinch, potentially leading to higher prices for goods and services.
  • Drivers can soften the blow by shopping around for the best fuel prices and adopting more fuel-efficient driving habits.