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Why is the price of fuel going back up, yet again?

Prepare for a huge jump in petrol prices next week as the fuel excise cut is returned in full. Picture by Sitthixay Ditthavong

A sharp increase in fuel prices will arrive next week as the six-month excise cut by the previous Morrison Federal government back in March is returned in full at the bowser.

Adding in the August Consumer Price Index (CPI) rise of 0.9 cents per litre, and topping it with GST, taxes on petrol and diesel will add an immediate 25.3 cents per litre to every pump from September 30.

Hopes of the new Labor government slowly easing the excise back in were dashed this week by Treasurer Jim Chalmers, who cited the need for "responsible budget management" and that ending the fuel excise tax relief was "part of the story".

It's estimated that around $500 million in federal fuel excise revenue was lost for every month the cut was in place.

For its part, the Australian Competition and Consumer Commission said it would "not hesitate to take action if retailers make misleading statements on price movements or if there is evidence of anti-competitive behaviour (such as price collusion)".

"Petrol stations must not make false and misleading statements to consumers about the reasons for any price increases," ACCC chair Gina Cass-Gottlieb said.

If there's even a glimmer of good news to be gleaned from this, it is that the 14-year fuel price highs seen mid-year have eased somewhat. But it will still be a huge and immediate price whack next week for anyone running a vehicle.

How can I minimise the impact of the price rise?

Only by diligently shopping around and using every tool available, including online fuel apps, shopper dockets, and shopping at the cheapest retail outlets such as Costco (which requires a $60 membership) and Metro.

The oil companies are on notice and the ACCC has pledged to monitor pricing at the wholesale and retail level so if your local petrol station sends the bowser price sky-high, then report it and provide details.

But you would need to know what the pump price paid was immediately before, and after, September 30.

The ACCC says it would not "hesitate to name retailers" and it says it "can take appropriate enforcement action".

But the fuel companies - which own and control the vast majority of ACT retail supplies - are deft masters at managing pump pricing.

The Treasurer says there are 700 millions litres of fuel at the old pricing "in the system". But any fuel deliveries after September 30 will be mixed with the old. Good luck to the ACCC in unravelling that can of worms.

Will using fuel price apps be any help?

Only to a certain extent because the fuel apps available to ACT motorists are crowd-sourced only.

They rely on people sending their pump price paid to the app, which can be a little hit and miss in generating up-to-date pricing.

PetrolSpy, MotorMouth and the newest on the scene (out of the US), GasBuddy, are the most commonly used crowd-sourced apps in the ACT and all are free, so researching the lowest prices across all of them will yield the best information.

7-Eleven has a fuel price lock which means that you can download its app and lock in the pump price you paid for a period of seven days, which at least can stall some pricing pain.

The other alternative is the FuelCheck app, which was set up by the NSW government and the NRMA so it has regulatory clout and day-to-day accuracy on pricing. But it only gathers data on service station pricing in NSW, so you would need to head across the border to take advantage of what is posted.

Introducing the FuelCheck app here was one of the key recommendations from an ACT Assembly fuel pricing inquiry 15 months ago but the NSW government wanted $1.3 million to hand it over. The ACT government didn't see paying that price as good value.

Is any price relief in sight?

Not after the Russians announced a partial militarisation of its forces this week to keep fighting in the Ukraine.

Russia is the the world's second-largest exporter of crude oil and refined petrol, as well the world's largest exporter of natural gas.

Now that Russia has shut off much of the natural gas that it supplies to Europe in retaliation for the West supplying arms and aid to the Ukraine, severe shortages are expected in counties such as Germany and France.

This will not only drive up the international price of gas, but of other fuel commodities.

Australia relies on imported fuel, sourced out of Singapore, and is completely at the mercy of international fuel price movements. Our benchmark price for 95-octane unleaded petroleum is set in Singapore, the largest oil trading exchange in our region. (The fuel is called Singapore Mogas 95, "mogas" meaning motor gasoline).

The latest international daily market watch published by the Australian Institute of Petroleum revealed how the slow downward trend that was evident through August to mid-September has stopped and is sharply climbing again since September 19.

To paraphrase from Game of Thrones, winter is coming to Europe. Demand will only go up. So both the Russian mobilisation, the onset of colder weather, and the latest US hike in interest rates are seen as the most critical factors in any predictive models.

Sitting at the bottom of the world, producing only a tiny amount of crude oil, in a deregulated market, leaves Australia at the whim of world events.

How do I save on fuel?

Treat petrol and diesel as a precious commodity, like water during a drought, and plan your vehicle usage so that you can eke the most distance-travelled efficiency from every tankful.

Use all the resources at your disposal to get the best petrol dollar value for your money, including apps and shopper dockets.

Keep your car well-tuned and serviced, push an extra five psi into the tyres and avoid the gas-guzzling idle of traffic wherever possible.

Danish-born adventurer Hans Tholstrup, who decades ago was our country's best-known fuel efficiency expert, said that one of the best simple tips for saving fuel while driving was to imagine you had an egg under the accelerator and that every squeeze might crack the shell.

The gloating you can hear in the background is that of those EV owners who jumped early and can sail past service stations with impunity.

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