Liquid gold: how to avoid price pain buying fuel and other fluids

Cost of living pressures come from all directions, even in the stuff we pour into our mouths and vehicles. Here are the biggest rises.

Petrol prices are frustrating motorists by surging towards record highs but are nowhere near the most expensive fluids Australians are buying.

When measured in price per litre, bottled water is up to four times more expensive than petrol, while alcoholic drinks cost between seven and 40 times more.

As new Australian Bureau of Statistics data shows petrol and beer experienced the biggest price rises in the past five years, consumer finance specialists say a little planning can save households thousands of dollars a year.

Buying in bulk is important, they say, because packaging and convenience dramatically inflates prices. Most consumers do not realise their bottled water costs up to $7 a litre – at least 2000 per cent more than households pay for tap water.

And motorists are being urged to follow fuel cycles, where pump prices vary up to 50c a litre during a month.

The latest ABS data shows automotive fuel prices have climbed 22 per cent in five years, rebounding strongly in the past 12 months from Covid’s global lockdowns.

CommSec senior economist Ryan Felsman said crude oil prices had climbed almost 50 per cent this year.

“Australia is a net importer of fuel, and a weaker Australian dollar and increasing fuel costs have driven up prices,” he said.

However, petrol prices are set to come under pressure in the future as the world goes green.

“By the end of the decade, the move towards electric vehicles and decarbonisation will have a huge impact on crude oil demand and supply,” Mr Felsman said.

Capital city petrol prices average $1.50 a litre and, while consumers can’t get discounts by buying in bulk, they can time their purchasing to potentially save more than $50 a week because most cities have price cycles.

Sort My Money founder Mr Rankin said people should monitor their local petrol stations.

“Some servos are always cheaper than the rest – use your local knowledge and compare prices as you are driving buy,” he said.

Petrol is one of the cheapest liquids per litre, with only milk ($1.30), bulk water (45c) and tap water (0.3c) costing less.

“Water’s an easy win when it comes to saving,” Mr Rankin said. “If you are thinking about water, you can’t beat having a water filter in the kitchen.

“Planning pays, and convenience costs.”

On the alcohol front, beer typically costs $11 a litre, wine $27 a litre and spirits $55 a litre, although prices vary dramatically.

Beyond Bank’s general manager customer experience Nick May said most drink purchases were emotionally driven.

“We also find that per unit we consider the cost of a drink reasonably low and insignificant, and it’s not until we collate the total cost of our drinks we consider that they are actually significant spends,” he said.

“Admittedly there is a greater production cost in bottled water but the cost of water at many outlets does seem excessive. Plan ahead and be organised.”

Beer prices had the second strongest growth of the past five years, up 15 per cent, which Mr Felsman and Mr May said was largely caused by rising government taxes.

Spirit prices rose almost 10 per cent but wine’s increase was below 2 per cent.

Mr Felsman said wine prices could remain under pressure as soaring Chinese tariffs hit exports.

Barista Nizar Said says many customers are price-conscious when buying coffee. Picture: Tricia Watkinson

COFFEE COSTS HAVE COOLED DOWN

Tough competition has kept a lid on takeaway coffee prices in recent years, says barista and cafe co-owner Nizar Said.

His observations are backed up by new Australian Bureau of Statistics data that shows the cost of coffee, tea and cocoa has dropped 3.7 per cent in the past five years – the only beverages to fall in price during the period.

Mr Said is co-owner of family business He Said, She Said, a cafe that launched almost two years ago, shortly before the pandemic.

“The market has become really overpopulated, with plenty of businesses doing unspecialised coffee, which consumers are happy to buy, and that has kept prices competitive,” he says.

Mr Said says many customers are price-conscious “especially when they are making variations to a standard order” but, for him personally, beverages are usually based on needs rather than wants.

The small businessman does keep an eye on petrol price cycles.

“I usually fill up the whole car tank when petrol is cheap to avoid paying inflated prices,” Mr Said says.