$0.32 per Litre Fuel Excise Reduction (Unleaded & Diesel)

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For those with an empty tank. If you can hold off until Wednesday to fill up, you will save 26.3c per liter on both unleaded and diesel fuel due to the fuel excise being halved.


Following a meeting of the National Cabinet today convened by the Prime Minister, the Australian Government will halve the fuel excise on petrol and diesel for three months.

The halving of the fuel excise will reduce the cost of fuel by 26.3 cents per litre.

This will reduce the cost of a 65L tank of fuel by nearly $19.

The spike in fuel prices as a result of the war in the Middle East is hurting Australians and causing financial stress. This will help to provide some relief.

The halving of the fuel excise will commence from April 1 and run to 30 June.

Further, the Albanese Government will reduce the Heavy Vehicle Road User Charge to zero for three months to help truckies continue their vital work for our nation. The Government will also defer the next scheduled increase in the Heavy Vehicle Road User Charge by six months.

Australians are encouraged to use public transport wherever possible to help conserve fuel for the regions, and we welcome existing moves to cut the costs of public transport.

The Australian Competition and Consumer Commission (ACCC) will continue to monitor fuel prices to help ensure that the lower excise rate is fully passed on at the bowser.

While Australia’s fuel supply outlook remains secure in the near term because of the actions the Albanese Government has taken, the longer this war goes the worse the impacts will be.

We are acting now to prepare and shield Australians.

Since the conflict commenced four weeks ago the Albanese Government has taken swift action on fuel. We have:

Passed new laws to double penalties for petrol companies for price gouging
Appointed a national Fuel Supply Taskforce Coordinator and Taskforce
Released 20 per cent of Australia’s petrol and diesel fuel reserves, targeted at regional areas
Changed fuel standards to get more fuel flowing
Changed diesel standards so Australia’s refineries can supply more diesel
Tasked the ACCC to ramp up fuel price monitoring and issue on-the-spot fines.
Engaged with international partners to keep supply flowing, including securing a supply agreement with Singapore.
Introduced laws to make sure companies pay truckies fairly when fuel prices spike
And introduced legislation to underwrite the purchase of fuel by the private sector.


Mod 2/4: Further 5.7c/L cut announced, now 32c from 26.3c. Link and title updated. As the pricing is dynamic and cuts are to taxes (not the final retail price); and since the announcement, prices have not dropped further, we decided it is more sensible to update the existing deal, rather than have a new deal for the additional 5.7c.

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Comments

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  • +336

    No deal. It drives up demand and will deplete the tanks quicker.

    This is a supply side driven issue. No discounting will help.

    There are better ways to spend tax payer money.

    • +68

      It is so not a supply side driven issue, the fuel supply is exactly the same as before. Too many people panic buying is the issue

      • +45

        Then "discounting" is definitely not going help the demand side. Frankly, a lot less cars on the road and I doubt demand is much higher (if it is higher).

        And yes, it is a supply side issue with temp demand boost due to panic buying.

        Adding the discount is like adding fuel (no pun intended) to a fire.

        • +20

          Just because the price is high doesn't mean supply isn't available. All the ships full of oil that we've ordered and still arriving and there's no indication that supply will be constrained. Australia is a very rich country and we can outbid a lot of other countries very easily to maintain the supply as it was before the Iran war. The panic buying will even out with actual use in just a few weeks. The real problem is that it hurts supply to regional areas because, well there just isn't the extra trucks available on such short notice to move more fuel out there to make up for all the panic buying. If people just wouldn't panic buy, if they just bought as they normally would, there would be no crisis at all, fuel would just be more expensive same as it is everywhere else in the world that relies on the global fuel market.

          • +19

            @AustriaBargain: That’s not how economics works at all. From a global perspective, demand has remained the same (or even increased), while 20% of supply vanished overnight. That drives up the price of the commodity (in this case, oil). So while it may be true that all of the fuel originally intended for Australia is still getting to Australia, the commodity price has increased and we need to pay that going forward. We are in competition with other buyers for a reduced amount of supply.

            • +8

              @ASR-Briggs: 20% is exaggerated figure, it's more like between 8 - 10%.

              • Saudi Arabia has diverted some of it's oil to Yanbu port in Red Sea via existing pipeline

              • UAE has diverted it's oil to it's Fujairah port in Arabian Gulf which bypasses Hormuz Strait

              • Iraq is also exporting it's oil through existing pipeline to Turkey

              • Oman doesn't use Hormuz Strait as it's ports are on the Arabian Gulf

              Meanwhile, 100% of Iranian oil is flowing out to China without any constraints. Only countries that are fully dependent on Hormuz Strait are Bahrain, Kuwait and Qatar.

              • @Bargainian: I'm not so sure about this. It is certainly less than 20% as it was 20% before any diversions, but if we consider lng and refined products as well it seems to be well north of 10%.
                Happy to be slapped down.

                • @joshash:

                  20%

                  That twenty-something % includes LPG.

                  What I read is 20% of global energy and 30% of seaborne fertilizer exports pass through Strait of Hormuz.

              • @Bargainian: Iran is also allowing "friendlies" to use the strait

                • @Dr Phil: Yes, they allowing friendlies to use the strait but only if they're carrying Iranian/Iraqi oil or Qatari LNG. Both Iraq and Qatar are very close to Iran.

          • +15

            @AustriaBargain: People are really overestimating the panic buying situation. It's not like toilet paper where you can grab 3 or 4 more packets than normal, which is 400% increase from your normal consumption. No one can store that much fuel. A few 10L jerry cans from the odd numpty isn't going to drive up demand that much.

            • +1

              @Broden: Industry bloke was saying in a few hours demand went up 100% and stayed there. That's not something any business could reliably supply without big changes.

            • +5

              @Broden: The media and opposition are suggesting that it's the average person at the bowser but it's agriculture, mining and manufacturing in the regions. They have tanks capable of drawing large capacity.

            • +3

              @Broden: Borden's still active?

              Well done mate.

              Have you stocked up, like originally all those years ago?

          • -3

            @AustriaBargain:

            All the ships full of oil that we've ordered and still arriving and there's no indication that supply will be constrained.

            and yet the facts are different

            Six fuel ships bound for Australia cancelled as Bowen concedes ‘flow of oil to Asian refineries has slowed’

            https://www.theguardian.com/australia-news/2026/mar/22/six-f…

            • @M00Cow: 6 cancelled out of 80… And lowering the 2 remaining refineries fuel standards has covered those 6 fuel ships..

        • +2

          Its a form of relief for essential goods. Not some discount sale for discretionary items like Nintendo Switch 2 which will increase demand.

        • +1

          Let me add that petrol companies are raising the price of petrol ahead of the reduction in excise tax.
          Some BP stations in Sydney have just raised the price of ULP91 by 10c to 269.7c whilst most others are currently selling for 259.9 (but for how long).

          So the price after the 26.3c tax reduction will be 233.6c to 243.4c

          This price gouging move by the petrol companies reinforces the fact that fuel is in short supply and there is no competition in the market.

          The good news is that some independents are finally getting supply and selling for less than the majors so forcing prices back down as low as 241c.at the moment ($2,15 after tax reduction).

          So SetTherFaqUp is 100% correct!

      • +32

        It is so not a supply side driven issue

        Yes it is.

        20% of global oil supply is basically offline because they can't get it out the Strait of Hormuz.

        For reference the 1973 oil embargo affected 7% of global oil supply at the time and went for 6 months. Prices remained elevated for the rest of that decade. Economic stagnation ensued.

        We're only 1 month into this. It's going to get worse before it gets any better.

        Less supply of oil —> higher prices of oil + less fuel production —> higher prices of fuel

        • -7

          Australia can afford to pay whatever fuel costs. So supply won't be hurt here, it'll just be hurt somewhere else in the world that can't afford to suddenly pay so much more per barrel. Paying a dollar per litre more is annoying in Australia, but it isn't an option in many other parts of the world. They are going to go without, we aren't.

          • +6

            @AustriaBargain: Not all Australians can afford to pay whatever. Many of us already are going without petrol. So there's already downward pressure on demand for fuel.
            This saga has been going for a month already.
            People panic buying and filling up the spare car and a few jerry cans is already done.
            The temporary demand spike caused by average Australians is over.

            So if there are shortages now then it is because of either the supply side, or some wealthy individiuals or organisations are doing some kind of large scale hoarding. Not ordinary everyday Australians.

            The likely culprits: I would expect mining companies will be hoarding the (profanity) out of as much diesel as they can get their hands on. It would have taken a few weeks for them to receive first shipment of additional storage vessels. But I'd expect their hoarding is in full swing and will only increase. They are buying themselves a buffer in case and when rationing begins. Farmers would be attempting to do this too but they'd have less ability to get a result from their efforts.

          • +5

            @AustriaBargain: 100%

            I asked a number of friends about this and when it came down to it,
            They said: no buying cafe coffees this week or less restaurants lunches and ubereats to make up.

            While some will definitely struggle, especially if their business requires driving, the mass majority complaining just need to taper their lifestyle a little.

            • +1

              @fusion17: That's the lamest anecdote in support of an argument I've ever witnessed.

          • +7

            @AustriaBargain: Fuel isn't just what the normal person needs in their car, it's what gets food and goods delivered to the shops we buy at. Fuel pries going up affects everyone's pockets, not just people that use cars.

          • +1

            @AustriaBargain: A price increase caused by having to outbid other countries over reduced supplies is a supply issue.

            • +3

              @aloha2436: It's only really a supply issue if the strait doesn't open again soon, until then we have reciprocal methods like swapping Singapore's oil fuel for our natural gas.

        • +3

          Wrong, its not 20% of oil supply is cut, Saudi Aribia is now pumping 7 million barrels a day via it's East - West pipeline, It's more like 10% has been cut.

          • @Jessie Ryder: So they've increased it? Good to know.
            It's still worse than 1973.

            • @tenpercent: Well lucky it’s not 1973.

              A good chunk of cars in some countries are electric now as opposed to zero EVs in 73.

        • It's not 20% as Saudi Arabia and Qatar are piping a lot to the Red Sea and loading it there - probably 10-12% offline (and some of that is still going through the SOH, mainly to China). If the Houthis decide to attack tankers in the Red Sea that could become an issue but they are nowhere near as powerful as the IRGC in the SOH area.

          In 1973 oil basically increased by 400% in the space of no time and caused a major shock. We're not even close to that yet. Petrol consumption, on average, in cars in 1973/4 was at least double what it is now and they had no EVs. The biggest problem we face is the price and availability of diesel which is the main fuel for transport, distribution, agriculture.

          • @R4: dont forget bunker oil

      • +2

        That doesn't make sense, you can only fill your tank once. Jerry can hoarders are not going to be making any noticeable dent.

      • +3

        It is so not a supply side driven issue, the fuel supply is exactly the same as before.

        No it's not.

        Tankers destined for Australian are being redirected to other Asian countries because it is cheaper for them to deliver.

      • +2

        Because the tankers who were on ocean before or as conflict started are still coming here. But it's over at this point. We will have a fuel crisis, it's a matter of when.

        • -1

          Oil is not the issue. It’s refined fuels and yes , all the ships that were bringing fuel have landed. There is nothing in the ocean behind them. We have 30 days of diesel left in this country. It’s 2 weeks from Singapore refinery to here. Will supply come from somewhere else? Don’t know but as it stands right now , zero is on the way.
          Childishly negging the truth is ridiculous.

      • +2

        It's not a "current" supply-side driven issue, it's an anticipated future supply-side driven issue. Because by mid-April overseas supply might just fall off a cliff as the Asian refineries run dry and their governments start to panic, plus a US ground invasion very likely on the way.

        Remember when Brent briefly hit US$120 a barrel when the war started, and then everyone released their petroleum reserves? It's getting close to $120 again now. In other words the release was mostly pointless, because only facts on the ground in the Middle East matters, and investors, their expectations previously dulled by countless Trump TACO moves, are now starting to smell fear. Watch prices go up to $150-200 a barrel soon.

        And if everyone held off on buying until Wednesday (as OP suggested) there will be chaos, massive queues, shortages and fistfights at the pump. The people idling their cars sitting in queue would've wasted countless thousands of litres of petrol and diesel. A more elegant way of doing it would be to cap price rises (because you and I know $3/litre petrol is a near certainty) until the fuel excise cut is exhausted.

        Still not unexpected for a government who is terribly afraid of wielding a stick (because of scars from COVID & work-from-home) so they just give out carrots instead. The problem is that those carrots are the only thing left in an otherwise empty fridge, and you gotta eat tomorrow. And next week too.

      • -1

        How can you sit there and say its not a supply driven issue, when its repeated time and time again over the media and now out of Albozo's mouth, 'its a supply issue', 'ships have turned away' etc etc.

        Yes the panic buying hasn't helped, but the recorded supplies on sold were lied and fabricated by Blackout Bowen, any person with commonsense can see it!

      • Dr. Fatih Birol, Executive Director of the International Energy Agency (IEA), confirmed last year that there is excess supply capacity and depressed demand.

        1 and 2

      • It is so not a supply side driven issue

        It is so like totally a supply side driven issue though.

        https://web.archive.org/web/20260322023725/https://www.thegu…

      • +4

        "lowing it to be only 100%."

        Which is tax payer money.

        • The government is benefiting because of the cost of oil. whilst the consumer is footing the bill. its the least the government should do to help the everyday aussie

          • @monkman: "should do to help the everyday aussie"

            Can happen in other means such a cash hand out or free public transport to reduce demand on fuel.

            This, will no doubt being absorbed in full or partially by the private operators.

            Imagine during COVID, if the government handed out each household $10k to buy a car. The number cars for sale will not on increase, but part or all of the $10k will go to the seller.

            It won't work in an inelastic market.

            Either way, it is spending tax payer money. Just a matter of how it is spent.

          • +3

            @monkman: “The government is benefitting”

            This isn’t America. The money doesn’t go to our pollies pockets. It pays for things like Medicare, PBS etc. AKA the things that help the everyday Aussie.

            Free public transport, in addition to this, is likely the way to go. Not sure how we fund it though.

            • +2

              @homebrandjesus: "how we fund it though."

              Increase fuel excise.

              • @SetTheFaqUp: I guess you could also charge for public transport, but that also seems like a poor solution to this particular economic conundrum, doesn’t it?

          • +5

            @monkman: Fuel excise is a fixed cost per litre, not a percentage. Government revenue does not increase when the price goes up; it goes up when people buy more.

      • +6

        Excise is a fixed cents per litre tax (52.6c before this halving), it is not percentage based so does not increase from higher base prices.

        • -2

          "Excise is a fixed cents per litre tax (52.6c before this halving), it is not percentage based so does not increase from higher base prices."

          Oh dear, that is ALOT of taxpayers money.

        • +1

          True. GST is added to the excise and the price though.

      • +1

        Excise is fixed rate, not a percentage.

      • +1

        i don't think you understand how fuel.excise works.

        All Australian motorists who buy petrol and diesel at the bowser pay 51.6 cents a litre in fuel excise.

        https://www.aaa.asn.au/advocacy/explainers/fuel-excise-expla…

        They're making extra on the GST, as it increases as the price does..

        • Fuel excise in effect goes to building and maintaining roads typically in the form of grants to states and territories - in the case of a temporary cut to excise, those grants are unlikely to be reduced so the Commonwealth budget will bear the loss; all of the GST take gets divided up among the treasuries of governments of states and territories - if the GST take goes up as result of higher fuel prices, they get more.

          • +5

            @Ponsonby: Just a small correction In Australia, fuel excise does not go directly to building or maintaining roads. It is a general Commonwealth tax that flows into the federal government’s consolidated revenue pot, the same as income tax or company tax. There is no full hypothecation (earmarking) for roads.

            Only a small portion (roughly 5–6%, mainly from the indexation component since 2014) is formally directed to states/territories for road infrastructure via a special account.
            The vast majority of fuel excise revenue is used for whatever the federal government chooses in the budget, not automatically for roads.

            • +2

              @MDSUXKS: Yes and No. Technically in line with the Commonwealth constitution, all excise revenue goes into the big bucket, which is then divided up among the various categories of spending including payments to the states and territories. But total spending on roads by all levels of government (well over $40b annually) far exceeds the net petroleum excise collected ($15b) and also exceeds the total of roads related revenue collected by all levels of government including excise and state registration charges etc

              https://www.bitre.gov.au/publications/2025/australian-infras…

    • +3

      Nothing like government intervention to prevent the market from reducing demand with increased prices.

      • -1

        "increased prices"

        Well said.

    • -1

      Can you elaborate on what you mean by drive up demand? Are you saying that people will suddenly start burning more fuel? Or do you believe people are going to hoard further?

      • +3

        There is a 20% deficit (waves hands at panic buying, countries restricting exports etc).
        At the margin, high prices reduce consumption. E.g. my kid caught the train to see his girlfriend instead of driving last week.
        If you subsidize the costs, that demand destruction will not happen at the same rates.

        We will still need 20% lower fuel consumption, but now the price to destroy that demand will raise higher.
        Well, actually it will rise to the same place, but as a country we will miss out on the tax, and the sellers will make more profit.

        • waves hands at panic buying

          I keep seeing people talk about "panic buying" online, but I don't understand what this is.

          Does "panic buying" refer to:
          1. individuals who purchase fuel in a state of panic, who may not need it?
          2. organizations personified as collectively in a state of "panic" when purchasing more fuel, who may not need it.
          3. individuals making a rational choice to buy fuel to store to be better prepared for future rationing, whether in a state of panic or not.
          4. organizations making a rational choice to buy fuel to store to be better prepared for future rationing, whether being personified as in a state of panic or not.

          1 & 3 can have negligible effect on the market beyond 1 or 2 weeks. There simply isn't much personal storage.
          2 seems very unlikely.
          4 does seem possible, but why refer to that as "panic buying" when it's a rational decision?

          Well, actually it will rise to the same place, but as a country we will miss out on the tax, and the sellers will make more profit.

          You're completely right, and this is yet another transfer of public wealth to private hands.

    • +2

      You're correct that this not a solution as it only address the demand side of the equation, however I think you fail to understand the difference between a subsidy and an excise. This is a tax break for the Australian consumers. In other words, the government is taxing us less for using fuel during this supply shock. This is smart and obvious move for the government to make to keep the consumer sentiment afloat and the economy ticking.

      • +1

        The problem is that it's a very short-term band-aid, in this case petrol prices would probably be down for a few days before rising back up to pre-excise cut levels.

        And prices will very likely rise about $3 a litre. If prices are $3.50 a litre and the government cuts 25c off I still wouldn't drive at $3.25 a litre. Is it a tax break if I won't buy any petrol at that price?

        And I cannot be certain prices won't rise to $4 or even $5 a litre. Why? Because Trump is mobilising ground troops for an invasion, and the international oil market, long lulled by countless Trump TACO moves, is starting to smell fear……

      • +1

        Yeah, smarter thing to ease the burden IMO would be to keep the tax but provide an equivalent cost of living rebate to households elsewhere. So you ease cost burden and encourage less fuel use where able.

        Cutting the tax doesn't do anything for business/construction costs either because they claim it back at tax time anyway.

      • This is a tax break for the Australian consumers.

        Business (road transport) use 90% of fuel in Australia. And whilst there are tax credits. This is still a massive subsidy for business over regular consumers

    • -1

      There are better ways to spend tax payer money.

      They aren't spending any money

      • +9

        That's semantics. By forgoing that revenue there is an opportunity cost.

    • +4

      Agreed. Basic economics. Would have made more sense to use the funds to build out a Mega charger network for BEV semi trailers.

      • +2

        With no trucks that could use it and a power grid unable to service it … your basic economics sucks

        • +1

          There are trucks now available such as the one from Windrose and more coming. As I said build out, that means heavy distribution lines and batteries onsite. There was the first delivery from Sydney to Canberra by an EV semi, so it can be done. It would likely take 18 months to 2 years to build out the first of the Mega Chargers for semi trucks. The grid has the capacity to handle it when there are batteries used at the charging location.

      • +2

        As a truck driver that won't help. Ultimately I don't see EV as the long term solution for road freight, and the industry needs immediate actions or there's going to be a sizeable collapse. A lot of work is currently being done at a loss until the burden can be passed on. It's a low margin industry that's only around due to people in it being passionate about what they do.

        • +1

          There are trucks now available such as the one from Windrose and more coming. As I said build out, that means heavy distribution lines and batteries onsite. There was the first delivery from Sydney to Canberra by an EV semi, so it can be done. It would likely take 18 months to 2 years to build out the first of the Mega Chargers for semi trucks. The grid has the capacity to handle it when there are batteries used at the charging location.

          Assistance for the trucking industry makes sense, but not for most end consumer drivers. It would be rare for a truck to be driving around without doing needed work. This is not the case for many trips done in cars, where trips are often unnecessary or alternative transport could be used.

          • +1

            @whats up skip: I've spoken with a guy who has tried out a Windrose truck. The lack of range kills its use outside specific cases. I can drive up to 6hrs without needing to stop for a break, and can do over 2000km in my current truck without needing to refuel, although you can get much longer ranges than that. My days are also already long enough as is without having to try recharging a battery on top unless every parking bay and every customer loading bay starts offering charging. A Melbourne to Sydney run in a Windrose with the tonnages we run at would likely see me charging at Avenel, Tarcutta, and somewhere before Sydney, with Windrose themselves saying it's about an hour to charge. With diesel that's a single 10 minute top up if I even need fuel to get there. Hell I can even brim my tanks and make it to Brisbane with time spent in Sydney to unload and load again. Depending on delays and traffic I can be looking at 2 15-17 hour days to do that with that single fuel up leaving Melbourne. My 30 minute lunch and dinner stops now become hour long, more if I have to wait for a free charging port, and the likelihood that I don't go home for the weekend goes up significantly.

            • @ryan7653: The Tesla Semi can go almost twice as far on one charge, so you can see what will be available over the next 12 months or so. As I said it will take two years to build out a basic Mega charging network on the key routes. The Windrose are great for urban routes and there are a huge number of those loads. Most distribution centres will start to have Mega Chargers. You just have to look at what is happening in Europe, USA and China. We are years behind Europe and China. You are too focused on solving everything now, rather than what can be done now. We could easily reduce 20% of Australia's truck/transport diesel consumption within a few years, but unfortunately our governments don't see the critical importance.

              The bottom line is: No Diesel, no deliveries.
              This is not a good option.

    • +2

      what they should be doing is dropping excise in diesel so the transport companies can keep their price increases lower..That's going to be the real.problem for the rest of the year. Like covid, when the costs come down, retail prices will remain elevated.

      • +1

        Takes more than 3 days to do that though.

        I'd argue that they should do both. Drop the excise like they have, while building the network like you said, funded by a 25% tax on gas exports. Win win.

    • +10

      The government in a country about to run out of fuel is encouraging fuel consumption. Unbelievable…

      • +2

        Agreed.

      • And they are still supporting the Us/israhell in creating this crisis

    • Agreed..!! “The measures will cost taxpayers $2.55 billion”

      Provided the International Energy Agency
      1. Most IEA countries (≈80–90%) meet the 90-day rule.
      2. A small minority (3–6 countries at any time) fall short, Australia is one of the few long-term underperformers

      • “The measures will cost taxpayers $2.55 billion”

        How much would it cost us to meet the IEA rule to setup the infrastructure and then annual maintenance costs?

        • I think I remember reading about $5 billion yearly.

          Given these guidelines have been in place for over 50 years now, it’s safe to say it’s saved us a lot of money, much more than what it’s currently costing us.

      • -1

        Tt will not COST the taxpayer anything, the tax payer is the one getting the saving, it might reduce government income but that is not the same as costing the tax payer. Lord the money in your bank account that you have earned is yours, not just something you are holding onto til you decide what portion of it you want to give back to the government.

      • +1

        Brother. They can print money like your print papers. There is no limit to printing.

    • Yeah what a dumb way to tax us more elsewhere.

    • +2

      I think there is one key point everybody is missing in the government statement.
      This is the first direct economic move by the government and it is set for a 3-month period.
      I think it has already been clearly foreseen that we are in for a LONG war.

    • +1

      No discounting will help.

      But kicking the problem can down the road in favour of talk back and morning tv interview happy news vibes is policy 101 :)

    • +2

      Not collecting tax is NOT "spending tax payer money"

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