Petrol prices have spiked to well over $2 a litre due to global pressures including Russia’s invasion of Ukraine.
As such, Coalition MPs are calling on the federal government to cut the fuel excise.
In a statement on Monday, the Australian Competition and Consumer Commission (ACCC) acknowledged that Russia’s invasion of Ukraine and the OPEC cartel’s refusal to boost crude oil production, combined with recovering oil demand as countries relaxed COVID-19 restrictions, pushed February prices for average retail petrol in Australia’s five largest cities to an eight-year high.
“The world was already experiencing high crude oil prices late last year due to the continuing actions of the OPEC and Russia cartel, and the enduring Northern Hemisphere energy crisis. The shocking events in Ukraine have forced crude oil prices even higher, as Russia is a major supplier of oil,” ACCC Chair Rod Sims said.
Taking to Twitter over the weekend, South Australian Liberal Premier Steven Marshall revealed that he had written to the federal government asking it to consider measures in the March federal budget, including to temporarily reduce the 44-cents per litre excise on fuel.
In an effort to bolster support for his re-election campaign, with the vote set to place in under a week, Mr Marshall reiterated his point of view to Channel 9, noting that "temporary relief would be very, very much welcomed."
"I mean, we've seen it going from, you know, $1.70 to $2.20. That's gone above the total excise you even pay on fuel per litre."
But addressing similar calls last week, Treasurer Josh Frydenberg told the ABC he would not speculate about the budget.
“There's groups that have asked for that excise to be cut, there's others that recognise the money needs to be spent on our transport infrastructure. I don't think it pays for me, just two weeks out, to speculate on that,” Mr Frydenberg said on Friday.
Also last week, Treasurer Josh Frydenberg said that while Australia is better placed than most to withstand pressures from Russia, “there will be costs borne by Australians”.
With the prospect of even stronger sanctions and prolonged measures, the Treasurer said safeguarding supply chains will come with a cost.
“The message to Russia and others is clear, there will be swift and significant economic costs imposed on those countries that choose to violate our fundamental international rules and norms,” Mr Frydenberg said.
“But we must not be naive about the costs these necessary actions will also impose on the West.”
These costs, he said, will flow initially in the form of higher commodity prices and in turn higher inflation.
“For liberal and free nations, this is a price that we must be willing to pay for the right to live free of fear and coercion.”
Maja Garaca Djurdjevic
Maja's career in journalism spans well over a decade across finance, business and politics. Now an experienced editor and reporter across all elements of the financial services sector, prior to joining Momentum Media, Maja reported for several established news outlets in Southeast Europe, scrutinising key processes in post-conflict societies.
