Petrol pain ahead: are you ready for another fuel price spike?

Fuel prices have been back near record highs, and many motorists don’t realise a 22c jump is coming. Here’s what you can do.

Many motorists are seeing red over fuel prices. Picture: Franck Fife/AFP

Has a petrol bowser brought you to tears lately?

I discovered their eye-watering power last week when I spent more than $250 for the first time filling up my car.

It’s a large SUV, like many modern cars, but it only feels like yesterday that the cost was much closer to $100 than $200, let alone $250.

And the worst part is that in a few months the cost of a full tank could surge beyond $300.

The fuel prices Aussies are paying today are being kept artificially lower because government taxes were halved in March for six months.

The petrol and diesel excise was cut from 44.2c to 22.1c a litre as a temporary cost of living measure, and it’s unlikely to extend beyond September as it’s draining almost $1 billion a month from the budget.

The latest spike reflects a renewed surge in global oil prices, and Russia’s war on Ukraine. European nations are proposing to ban Russian oil in response to the invasion, while Russia itself is halting gas supplies to some countries it’s unhappy with.

Recent refinery fires and ongoing supply issues are also pushing up the oil price above $US110 a barrel, barely two years after it was trading below $US20 a barrel.

Every $US1 rise in oil prices impacts Australian pump prices by about 1c a litre.

Nobody can fully offset the impact of this price pain, but most motorists can take steps to claw back some of the cost blowouts.

KNOW THE MARKET

Knowledge is power in most money matters, and is easier to obtain around fuel prices than for other consumer purchases.

There’s a wide range of commercial, government and motoring body websites and apps that will tell you prices in your area. Understand that some are real-time, while others rely on app users to update prices so may be a little dated.

Why is she smiling? Paying $2-plus for fuel is now normal, and taxes will jump soon.

CYCLE WATCH #1

Petrol prices move in cycles in most capital cities. Lately it may be from one ridiculously high level to an even more ridiculously high level, but buying at the right time of the cycle can still save you about 30c a litre.

The Australian Competition and Consumer Commission’s website has up-to-date graphs showing where in the cycle your city’s fuel currently sits. Timing the cycle can see you save more than $18 a tank.

CYCLE WATCH #2

Got a bike sitting dusty in a corner? Now might be a great time to wheel it out, because you’ll save a pile on petrol.

Cycling lanes have improved and bike sales went nuts earlier in the pandemic.

And if cycling’s not your thing, consider other fuel-saving tactics such as walking, car pooling and public transport.

FUEL DISCOUNTS

Discount dockets and reward cards that offer between 4c and 10c a litre off fuel don’t feel rewarding when motorists are paying $2 a litre.

However, add them to other savings such as buying at low points of the cycle, and there are some significant savings available. Check if you can multiply points with reward credit cards or frequent flyer programs.

DRIVE NICELY

Countless tests and researchers have found that motorists use less fuel when they avoid harsh braking and acceleration, keep their tyres inflated correctly, avoid drag from open windows, go easy on the aircon, don’t carry heavy items everywhere and steer clear of heavy traffic where possible.