Victorian petrol prices: $2 barrier broken, fuel excise calls grow louder

The peak farming body has called on the Federal Government to step in and ease fuel pressures for farmers.

The Victorian Farmers Federation has called on the Federal Government to ease fuel price pressures for primary producers in the face of ongoing global volatility.

It comes as fuel prices surge past the $2-a-litre barrier for the first time in some parts of regional Victoria, with calls growing for an excise cut.

VFF president Emma Germano said the entire agricultural supply chain was reliant on “a secure, affordable and disruption-free fuel supply”.

“As producers of perishable essential goods, the security and timeliness of supply are critical,” Ms Germano said.

“Members of the International Energy Association are obliged to hold 90 days of net fuel import and Australia has been non-compliant since 2012. While Australia does have strategic national reserves, they are stored in the United States and would take over three weeks to reach Australia in the event of a crisis.”

“Given the global uncertainty in the market, we’re calling for adequate resources to be allocated to the entire supply chain and our strategic fuel reserves to be brought onshore.”

Diesel prices are now more than $2 a litre in Bendigo, Shepparton and Portland, while there appears to be a lag in unleaded prices, which have already surpassed $2 a litre in central Melbourne.

Fuel prices across Victoria continue to rise in the face of ongoing global volatility and uncertainty.

RACV spokesman Andrew Scannell said the trend for fuel prices over the coming weeks was difficult to predict.

While Australia imports little oil or other fuel from Russia, Moscow’s invasion of Ukraine in the past fortnight has triggered uncertainty over supply worldwide.

“(It) will depend on a range of factors including geographical area, availability, international benchmark prices, taxes, the value of the Australian dollar relative to the US dollar, and levels of competition in different areas,” Mr Scannell said.

Last week, Federal Agriculture Minister David Littleproud pushed back on a campaign to cut fuel excise led by independent senator Rex Patrick.

Mr Patrick told The Weekly Times recently that a 50 per cent cut to the fuel excise would help to ease cost pressures faced by regional households and businesses.

However, Prime Minister Scott Morrison has left the door open to an excise cut in several interviews this week.

South Australian premier Steven Marshall and Mallee MP Anne Webster are just two of several Coalition figures calling for an excise cut in the federal budget.

Victorian Transport Association chief executive Peter Anderson said while transport operators were “no strangers to fluctuations in fuel pricing”, supply chain disruptions, rising interest rates, and a war in Eastern Europe was proving a “perfect storm”.

“On one hand, operators are loathe to disenfranchise customers by raising prices. On the other hand, absorbing higher fuel and other costs will only impact already stressed operators trying to meet payroll, pay their bills, and keep their businesses afloat,” Mr Anderson said.

“We conservatively expect transport costs to rise by 20 per cent over the next three months as a result of this perfect storm – perhaps more.”