What affects fuel prices

  • Fuel prices in Australia are set by the market.
  • International benchmark prices and the value of the Australian dollar have the most influence on the price consumers pay for fuel.
  • Pricing decisions by wholesalers and retailers, and levels of competition in different locations influence fuel prices.

What the ACCC does

  • We monitor Australian fuel prices.
  • We report on fuel prices and the overseas and local factors influencing prices.
  • We investigate the issue further and may take action if we think a fuel retailer has broken competition or consumer law.

What the ACCC can't do

  • We don’t set or control Australian fuel prices.
  • We don’t regulate the fuel industry.

International benchmark prices

International benchmark prices have the most influence on the price you pay for petrol, diesel and automotive LPG.

Benchmark prices for petrol and diesel are linked to crude oil prices because crude oil is a major production input. Crude oil is an internationally traded commodity, and its price is determined by changing global demand and supply factors.

Current benchmark prices for fuels sold in Australia:

Fuel type

Benchmark price

Price changes:

Regular unleaded petrol

Singapore Mogas 95 unleaded

Daily

Diesel

Singapore Gasoil 10 parts per million sulphur

Daily

LPG

Saudi contract prices (Saudi CP) for butane and propane

Monthly

Changes in international benchmark prices can take around 2 weeks to work their way through the supply chain in Australian cities. It takes longer in regional areas.

This chart shows how the price of regular unleaded petrol in the 5 largest Australian cities of Sydney, Melbourne, Brisbane, Adelaide and Perth has been tracking against the international benchmark price over the last 90 days.

Chart showing how the price of petrol in the 5 largest cities has been tracking against the international benchmark.

Source: ACCC calculations based on FUELtrac, Argus Media and Reserve Bank of Australia data.1

  • The retail price is a 7-day rolling average.
  • The international price is a 7-day rolling average Singapore Mogas 95 unleaded price, lagged by 10 days.

Value of the Australian dollar

The international benchmark price is set in U.S. dollars. As a result, a change in the value of the Australian dollar relative to the U.S. dollar can affect the domestic price of fuel.

Even so, don’t expect fuel prices to fall every time the Australian dollar moves higher against the U.S dollar. This can only happen if:

  • the benchmark price stays the same or falls, and
  • other local factors don’t push the price up.

Fuel wholesaler and retailer costs

Fuel wholesalers and retailers have different costs that they need to recover through their pricing. Costs can include wharfage, freight, insurance, transport, storage, salaries, rent, power and other utilities.

Wholesalers and retailers also need to make a profit so that their businesses can continue to operate. The level of competition in the marketplace influences the amount of profit they make.

Transporting and storing LPG is more expensive than for petrol and diesel, because LPG must be kept as a liquid. This requires specialised storage and transportation.

Taxes and other costs

Goods and services tax (GST)

Retail fuel prices in Australia include GST at the rate of 10% (or 1/11 of the total price paid).

Excise duty

Excise rates on fuel and petroleum products, other than aviation fuels, are indexed twice a year in line with the consumer price index (CPI). This generally occurs in February and August.

Automatic indexation of fuel excise was re-introduced by the Australian Government on 1 July 2015.

On 29 March 2022 the Australian Government announced a 50% cut in fuel excise for 6 months. This took effect from 30 March 2022.

From 1 August to 28 September 2022, excise rates are:

  • 23.0 cents per litre for unleaded petrol (regular and premium grades) and diesel
  • 7.5 cents per litre for automotive LPG.

More information on current excise duty rates for fuel and petroleum products is available on the Australian Taxation Office website.

See Monitoring fuel prices following the excise cut

Petrol price cycles

Petrol prices move up and down in patterns in Australia's largest capital cities.

Petrol prices steadily decrease for a period followed by a sharper increase. This pattern is also known as a petrol price cycle. It is a movement in the retail price from a low point (or trough) to a high point (or peak) to the following low point.

Petrol price cycles are the result of pricing policies and not from changes in the wholesale cost of fuel.

You can use price cycles to help you decide when to buy petrol in Sydney, Melbourne, Brisbane, Perth and Adelaide. Petrol price cycles don’t occur in Canberra, Hobart and Darwin.

See Petrol price cycles in capital cities for more information.

Public holiday prices

Consumers have asked the ACCC whether petrol prices increase by more than usual in the days before public holidays and long weekends.

Our last detailed analysis of the data indicates that, on average, public holiday price increases in the 5 largest cities were no larger than usual price cycle increases during the year.

These price rises may be more noticeable before holiday weekends when many motorists are making long trips and using more petrol than usual.

Report anti-competitive behaviour in the fuel industry

Anyone can report a fuel retailer not competing fairly to the ACCC. We use these reports to identify issues that need investigation.

Make a report to the ACCC

See also

ACCC role in fuel monitoring

Fuel reports

Important notice

[1] The ACCC obtains confidential proprietary data from Argus Media under licence, from which data the ACCC conducts and publishes its own calculations and forms its own opinions. Argus Media does not make or give any warranty, express or implied, as to the accuracy, currency, adequacy, or completeness of its data and it shall not be liable for any loss or damage arising from any party’s reliance on, or use of, the data provided or the ACCC’s calculations.

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