Australians have been urged to keep calm and forget about the war as the global fuel crisis continues to smash motorists at the bowser with near-record prices coming out of the Easter long weekend.
It comes as a confronting map of the world has exposed just how vulnerable Australia has been to fuel price increases as the Iran conflict rages on.
According to data from Globalpetrolprices, Australia has seen the fourth-highest increase in petrol prices with a 46.5 per cent increase since February 23, while diesel prices have risen 64.1 per cent in that time, the ninth-highest.
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Myanmar has been hardest hit for both, with petrol up 100 per cent and diesel up 120 per cent since before the war, due to its thin reserves and severely weakened currency under military rule.
By contrast, Madagascar has come out on top, with petrol and diesel prices actually declining.
The African island nation of 33 million mainly imports its fuel from Oman, avoiding the Strait of Hormuz, secures supplies weeks in advance and maintains robust reserves.
Motorists in Israel, which launched the February 28 war with the US, have also been shielded from pain at the pump as fuel prices are set by the government monthly, rising just 2 per cent since February 23.
“Governments in countries with regulated prices often wait several weeks to determine whether the oil price change is permanent before adjusting retail prices,” Globalpetrolprices notes.
“If the shock is large, governments may also intervene to suppress a price increase.”
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NRMA spokesman Peter Khoury said unleaded prices appeared to be stabilising but “diesel prices we’re worried about”.
The wholesale price for diesel reached as high as 314 cents and dropped to 291 cents after the excise cut, but was “still really high” at 305 cents per litre on Tuesday, while unleaded had dropped to 207 cents.
“I don’t think the average [retail price] for diesel ever dropped below $3,” Mr Khoury told news.com.au.
The international crude oil benchmark price for diesel, Singapore Gasoil, has tripled since the start of the war, Mr Khoury said, while the price of Tapis crude, the Malaysian benchmark for unleaded petrol, had dropped from a record high but was still 50 per cent above pre-war levels.
“Until the war ends and there is a long-term solution to reopen the Strait, there isn’t much we can do here,” Mr Khoury said.
“They’ve cut the excise by half, beyond that there’s not much more we can do. We’re beholden to overseas factors, and all the language today suggests there’s going to be an escalation. That’s our concern. Until the war ends we just don’t see any avenue for any relief at the bowser.”
Brent crude, the main international oil benchmark, remained above $US110 per barrel on Tuesday, up from around $US75 before the war.
The Reserve Bank warned Aussies last week to brace for headline inflation to spike to 5 per cent in the year to June if oil prices remained above $US100 per barrel, about 75 basis points higher than expected.
Mr Khoury reiterated that the current fuel crisis was demand-driven, and urged motorists and industry to “go back to their pre-war buying habits”.
“We’re confident certainly until the end of April and into May that the government has absolutely secured enough supply,” he said.
“The tankers continue to arrive. We’ve got a demand-driven crisis here. Only fill up when you need it. We’re hearing reports of trucking companies and delivery companies telling their drivers, if they see diesel just fill up. That diesel will no doubt be used for industry but that’s outside of the normal buying habits and that puts pressure on the supply chain.”
The Australian government has been working with fuel suppliers in countries like Singapore, Japan, South Korea and Malaysia in a bid to ensure supply.
Australia, the world’s third-largest exporter of liquefied gas, has used its status as a gas exporting giant as leverage to secure fuel flows from Asia.
On Tuesday, Prime Minister Anthony Albanese confirmed he would head to Singapore later this week in a bid to “keep fuel flowing between both countries”.
Mr Albanese said the trip would help “strengthen energy supply chain resilience”.
It comes after Assistant Trade and Foreign Affairs Minister Matt Thistlethwaite said Japan had given an “assurance that normal supply will continue.”
He said South Korea and Singapore had already given similar assurances.
As of March 31, Australian had 39 days worth of petrol, 29 days of diesel and 30 days of jet fuel at normal rates of consumption.
The Minimum Stockholding Obligation (MSO), set by the federal government, requires suppliers to hold 1067 megalitres (ML) of petrol, 663 ML jet fuel and 2742 ML of diesel.
Energy Minister Chris Bowen provided an update on the number of service stations without fuel on Tuesday.
In NSW, 125 service stations were out of diesel and 34 had no petrol.
In Victoria, 40 were out of diesel and 29 were out of petrol.
Queensland had 34 with no diesel and 30 with no petrol.
In South Australia, seven were out of diesel and five out of petrol.
In Western Australia, 20 were out of diesel and 32 petrol.
In Tasmania, seven were out of diesel and six were out of petrol.
In the Northern Territory, four were out of diesel and four petrol.
In the ACT, four were without diesel and one without petrol.
“We’ve got more work to do to get that down to zero,” Mr Bowen told reporters in Sydney.
“But in NSW in particular, where we’ve been focusing with the industry on getting fuel to farmers because it’s sowing and seeding season, so therefore our service station numbers out of diesel have been higher than anyone would like. Because I think, rightly, people have been prioritising getting diesel to our farmers to make sure they can get the seeds into the ground.”
The average retail price for unleaded petrol hit 253.4 cents per litre in the week to March 29, 61.9 cents above the prior 12-week average, according to the latest data from the Australian Institute of Petroleum (AIP) as of March 29.
Average diesel prices reached 310 cents per litre, 102.7 cents above the 12-week average.
But prices began to ease last week after the federal government halved the excise on petrol and diesel and struck a deal with the states to return GST revenue on fuel sales.
The temporary three-month measures will shave 26.3 cents per litre off the fuel excise and 5.7 cents per litre from the GST, representing a total reduction of 32 cents per litre, Prime Minister Anthony Albanese told reporters on Thursday.
The federal government has also cut the Heavy Vehicle Road User Charge to zero, easing the pain on supply chains
“We’ve taken unprecedented action to underwrite industry and bring shiploads more fuel and fertiliser to Australia,” Mr Albanese said in a speech to the National Press Club.
“We’ve changed the law, so that all the fuel made in Australian refineries, stays on shore. We have given the ACCC new powers to crack down on petrol stations that do the wrong thing by their customers.”
The consumer watchdog has warned fuel retailers that the fuel tax cuts must be passed onto motorists as quickly as possible.
“We are pleased to see that already several retail sites have dropped fuel prices and passed on savings to customers in response to the initial cut in fuel excise on April 1,” Australian Competition and Consumer Commission (ACC) chair Gina Cass-Gottlieb said on Thursday.
“Earlier this week we made it very clear to the major fuel companies that we expect to see them pass on the full cut in the fuel excise to consumers without delay.”
As of Wednesday last week, daily average retail petrol prices were 16.7 cents lower and diesel prices were 15 cents lower compared with the previous day, according to the ACCC’s weekly fuel monitoring report.
Darwin saw the greatest reduction in petrol prices at 25.4 cents while Perth saw the smallest fall at 7.2 cents. Diesel prices fell most sharply in Adelaide, down 19.5 cents, while Perth also saw the smallest fall of 9.1 cents.
The ACCC said with international refined fuel prices continuing to be volatile, some retailers had moved to basing retail prices on what it would cost them to restock at current prices, rather than the cost of fuel currently in their storage as they normally would.
“While we recognise some areas have had supply or demand challenges, we encourage motorists to shop around where possible and reward those service stations that pass on the reductions,” Ms Cass-Gottlieb said.
The ACCC has also sent legal notices to several businesses in South Australia, Western Australia, Queensland and the Northern Territory — including cafes, restaurants and travel companies — requiring them to justify sizeable “fuel surcharges” of up to 70 per cent imposed on deliveries to remote areas.
“Businesses must not mislead consumers about their prices,” Ms Cass-Gottlieb said.
“If a business is going to impose a surcharge or levy and represent that it is directly related to the high fuel costs, then the business must be able to substantiate and justify those representations.”
