Australia Petrol Prices Rise As Excise Cut Ends

Australia Petrol Prices Rise as Excise Cut Ends in 2026 The price at the pump just jumped again, and this time it's not just global oil markets to blame. Australia's temporary fuel excise cut — introduced during the pandemic lockdowns — officially expired at the end of last month, adding roughly 21 cents per litre back to every fill-up. For the average driver, that's an extra $40 or so every time you top up a 60-litre tank. Real talk?

Most people saw this coming. The government never promised the cut would last forever. But the timing couldn't be worse. Inflation is still sticky, household budgets are stretched, and now filling up feels like a small act of financial endurance.

The short version is this: Australia's petrol prices are climbing again, and the excise cut ending is the latest reason why. What Is the Fuel Excise Cut Australia's fuel excise is a tax on petrol and diesel, currently set at 47.1 cents per litre (before any temporary adjustments). During the height of the pandemic, the federal government slashed it by 21 cents per litre as a cost-of-living relief measure. That meant drivers were only paying 26.1 cents per litre in excise — a significant drop from the usual rate.

The cut was always meant to be temporary. First introduced in March 2022, it was extended multiple times as fuel prices surged following Russia's invasion of Ukraine. But with inflation easing and the government needing to plug budget holes, the writing was on the wall. As of July 1, 2026, the full 47.1 cent rate is back in effect.

That's not just the excise itself — it's also the Goods and Services Tax (GST) on top, which adds another 10 percent. So the total tax component on every litre of petrol has jumped from roughly 28.7 cents to 51.8 cents. Why It Matters Now You might think 21 cents per litre isn't a big deal. But spread across millions of daily commuters and countless delivery trucks, it adds up fast.

The Australian Bureau of Statistics estimates that the average household spends around $200 per month on transport fuel. With the excise cut gone, that's climbing toward $280. For low-income households, the impact is even sharper. They spend a larger proportion of their income on transport, and many don't have the luxury of working from home or switching to electric vehicles overnight. Small thing, real impact.

And here's what most people miss: the excise cut wasn't just about saving money at the pump. It was also a signal. When governments intervene in fuel markets, even temporarily, it shows how politically sensitive energy costs are. Removing that support now — amid rising living costs — puts pressure on Prime Minister Albanese's cost-of-living credentials heading into the next election cycle.

The political fallout is real. Opposition leader Peter Dutton has already called the expiry "another nail in the coffin for working families. " Whether that resonates with voters will depend on how much pain they feel at the bowser over the coming months. How the Price Jump Actually Works Let's break down what happens when you fill up 60 litres of petrol at today's prices.

The Tax Component Before the cut expired, you were paying 26.1 cents per litre in excise, plus 10 percent GST on the total price. That brought the tax portion to roughly 28.7 cents per litre. Now, with the full excise back, it's 47.1 cents plus GST — about 51.8 cents per litre. That's a 23.1 cent increase per litre.

On 60 litres, that's $13.86 extra. On a monthly basis, assuming four fill-ups, that's over $55 added to your transport costs. Global Oil Prices Play a Role Too The excise cut ending isn't the only factor. Global crude oil prices have been volatile throughout 2026.

OPEC+ production cuts earlier this year pushed Brent crude above $90 per barrel in April, though it's settled around $82 as of mid-July. Refining margins — the difference between crude cost and retail petrol price — have also tightened. Australia's four remaining oil refineries are operating at near capacity, and any disruption can send local prices spiking. State-Based Variations Not all states feel the pinch equally.

South Australia and the Northern Territory tend to have higher retail margins due to fewer competing service stations. Meanwhile, New South Wales and Victoria usually see more competitive pricing thanks to denser market competition. But regardless of where you live, the excise increase hits everyone the same way: 21 cents more per litre, every time you fill up. Common Mistakes People Make I know it sounds simple — but it's easy to miss some of the nuances around fuel pricing.

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Here are the mistakes I see most often: Thinking the Excise Cut Was Permanent Relief Plenty of drivers assumed the 21-cent cut would stick around. After all, it had been in place for over four years. But temporary measures rarely become permanent, especially when governments need to shore up budget positions. Ignoring the GST Component The excise is only part of the tax story.

When the government talks about "adding back 21 cents," they're referring to the pre-GST amount. The actual increase at the pump includes GST on top, making it closer to 23 cents per litre. Blaming Oil Companies Alone Sure, retailers set the final pump price. But they're responding to wholesale costs, exchange rates, and yes — tax changes.

The excise cut ending is a government decision, not a corporate conspiracy. Not Shopping Around Fuel prices vary significantly between suburbs and even between service stations on the same street. Apps like FuelMap and Gaspy show real-time prices. A 20-cent difference per litre on 60 litres is $12 saved — enough to cover a week's coffee habit.

Practical Tips That Actually Work So what can you do about rising fuel costs? Some of this is obvious, some less so. Time Your Fill-Ups Fuel prices don't stay static. In most capital cities, there's a weekly cycle driven by competition between retailers.

Tuesday and Wednesday are often the cheapest days to fill up, while Friday and Saturday tend to be the most expensive. Use apps like FuelMap to track local trends. In Melbourne, for example, you can save 15-20 cents per litre just by filling up mid-week instead of at the weekend. Consider Your Vehicle Choices If you're due for a car upgrade, now's the time to think about fuel efficiency.

A car that drinks 8 litres per 100km versus one that drinks 12 litres per 100km will save you roughly $300 per year at current prices — assuming 15,000km of annual driving. Hybrids and EVs are becoming more affordable. The government's fringe benefits tax exemption on EVs continues through 2026, making electric vehicles more attractive than ever for salary-sacrificing employees. Adjust Your Driving Habits Aggressive acceleration and braking can increase fuel consumption by up to 30 percent in city driving.

Smooth acceleration, proper tyre pressure, and removing roof racks when not needed can all help. For longer trips, plan routes to avoid traffic hotspots. Idling in congestion burns fuel without getting you anywhere. Explore Alternative Transport Not everyone can work from home, but where possible, combining trips or using public transport for part of your commute can help.

Even one day a week on the train or bus can save 20-30 litres of fuel. Carpooling apps like BlaBlaCar are popular in Australia, and many employers offer ride-sharing incentives. FAQ How much did petrol prices increase when the excise cut ended? Roughly 23 cents per litre, including GST.

That's about $13.86 extra on a 60-litre fill-up. When exactly did the excise cut expire? The temporary 21-cent reduction ended on July 1, 2026. The full 47.1 cent per litre excise rate is now back in effect.

Will the excise cut be brought back? Unlikely. The government has indicated the cut was always temporary, and budget pressures make reinstating it politically and financially difficult. Are other countries facing similar issues?

Yes. Many governments introduced temporary fuel tax cuts during the pandemic and energy crisis. Most have since expired, leading to price increases across Europe and North America. How can I check the cheapest fuel prices near me?

Apps like FuelMap, Gaspy, and even Google Maps show real-time fuel prices at nearby stations. Prices can vary by 20-30 cents per litre within the same suburb. The Road Ahead Australia's petrol prices are settling into a new normal — higher taxes, volatile global markets, and increasing pressure to transition away from fossil fuels. The excise cut ending is just one piece of a larger puzzle.

Over the next few years, expect fuel costs to remain a political hot-button issue.