If you feel like you are paying more than ever to fill up your car lately, you might be right.

“It’s ridiculous,” 19-year-old apprentice Joshua Sam said while filling up in Newcastle.

Mr Sam said he actively sought out the cheapest options, but had still not been able to afford to fill his tank up to the brim since gaining his licence more than a month ago.

“I’m on apprenticeship wages. Whenever I need to fill it up I just like put in like 10 or 15 bucks’ worth,” he said.

Joshua Sam said affording fuel on an apprentice wage was difficult.(ABC Newcastle: Jesmine Cheong)

Like most high population areas, prices in the regional New South Wales city can often vary by up to 40 cents a litre, but that competition has not stopped prices from climbing nationally.

In April, Sydney recorded its highest ever daily average for regular unleaded petrol, at $2.23 cents a litre. 

While average petrol prices in Brisbane, Melbourne and Adelaide all peaked above $2.25 last month, they fell short of record highs.

But despite a precedent for government intervention, economists say there is unlikely to be any relief in the upcoming federal budget.

Consumers have been paying high prices for fuel again this year.(ABC Newcastle: Keely Johnson)

Why so expensive?

While things have cooled off slightly in recent weeks, a sustained high international refined fuel price and a low Australian dollar are keeping costs high.

The Australian Competition and Consumer Commission (ACCC) said the conflict in the Middle East was a contributing factor as well as the Russian-Ukraine war.

Australia has no control over international oil prices but relies on it, as the country imports most of its oil.

What the government does have control over, however, is how much tax they charge. 

The fuel excise charged on each litre of fuel is 49.6 cents per litre, and that is set to increase again in August in line with inflation.

The ACCC said the price paid at the pump was also impacted by GST, the cost of transporting fuel and the cost of retailing fuel.

International oil prices and taxes make up the bulk of the price of fuel.(Source: ACCC Petrol Monitoring Report March 2024)

Pain at the bowser

Analysis by motoring group NRMA shows the average Australian family spends more than $100 a week on fuel, equating to about $5,500 a year.

It costs Newcastle woman Erin Fuller $120 a week and has meant cutting back in other areas of her life.

“I’m pretty careful about my fuel use now and only fill up when I need to and try to push it as long as I can,” she said.

“I have to be a little bit more conscious about my spending, for example, less treats and less outings.”

Erin Fuller said it cost about $120 to fill her tank.(ABC Newcastle: Keely Johnson)

NRMA spokesman Peter Khoury said that weekly average “explodes” when you move out of the cities and into regional and coastal areas.

Even if prices are lower or comparable with major cities, travelling distances are often longer and public transport options are fewer.

For Donna Mills, a pensioner based at Nambucca Heads on the state’s Mid North Coast, where there are just two petrol stations in town, prices have hovered around $2 per litre for months.

“My car is my lifeline,” she said.

“We don’t have much public transport here, so to get to tennis or volunteering I need to drive. 

“I am now spending a large portion of my pension just on fuel.”

Relief unlikely

In 2022, the Coalition government halved the fuel excise for six months, with the aim of lowering fuel costs and easing cost of living pressures, but it was not extended by the new Labor government when it came into office.

The ABC contacted federal Treasurer Jim Chalmers, who would not confirm if a cut to the excise would be included in the May 14 budget. 

“Chances are, they won’t,” economist and commentator Chris Richardson said.

“Because it’s not really a good idea.

“People love it when the government gives them money during a cost of living crisis, but it can easily make inflation worse, rather than better.”

Mr Richardson said if the government wanted to help fight the cost of living crisis, it should fight inflation.

“The International Monetary Fund in January said the best way to do that was some combination of cutting spending and raising taxes,” he said.

“Now, economists would mostly agree with it, but it’s also political suicide.”

Mr Khoury said without intervention, it was unlikely fuel prices would drop in the short term.

“Is there relief in sight? The short answer is no, unfortunately,” he said. 

“The volatility of what’s happening globally, particularly in the Middle East, is keeping people on edge, particularly the markets.”

NRMA’s Peter Khoury said without intervention, it was unlikely fuel prices would drastically drop.(ABC News: John Gunn)

How to find cheap fuel

In most larger towns and cities, prices for fuel can differ wildly.

Mr Khoury said that was because petrol prices were not regulated in Australia, and service station owners could charge what they wanted.

“In Sydney, you can see price differences of 40, 50 and even recently 60 cents a litre, not just in the same suburb, but sometimes on the same street,” he said.

“It comes down to different marketing strategies.”

Different fuel prices on the same road in Mayfield, Newcastle.(ABC Newcastle: Keely Johnson)

Apprentice Joshua Sam said he used an app to compare fuel prices in Newcastle. 

“It shows you the price of all the petrol stations, and I’ll drive to the cheapest,” he said. 

NSW was the first state to make it law for service stations to post their fuel prices in real time through the Fuel Check app or website.

Since then, some form of that legislation has been rolled out across every state and territory, excluding Victoria.

The NSW app has been downloaded nearly 2 million times since it launched in 2017, with the number of downloads for this year so far on track to be higher than 2023.

The ACCC also recommends keeping an eye on price cycles that occur in some cities including Sydney, Melbourne, Brisbane, Adelaide and Perth.

In a statement, a spokesperson for the federal treasurer’s office said the government was focused on “other ways” to provide cost of living relief for Australians in the upcoming budget.

“Including through our changes to deliver a tax cut for every taxpayer, energy rebates, cheaper childcare and cheaper medicines,” it said.

“As the treasurer has said, we will consider additional help on top of that if it’s affordable, if it’s responsible and if it helps takes some of the edge off inflation in our economy.”

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