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Petrol prices in Australiacould be about to get even more expensive - here's why
· Treasurer Jim Chalmers warningof petrol pain
· READ MORE: Big banks tip November rate hike
PUBLISHED: 09:25AEDT, 26 October 2023 | UPDATED: 09:27 AEDT, 26 October 2023
Treasurer Jim Chalmers fears Australian motorists could suffer even more pain at the bowser following a 20 per cent surge in petrol prices.
Australia's cost of living crisis is getting worse, with inflation in the year to September remaining high at 5.4 per cent - sparking fears of a November interest rate rise.
The official consumer price index data also showed a 19.7 per cent annual increase in automotive fuel prices, which has seen motorists pay $2.40 a litre for 95 octane premium unleaded.
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This predated terrorist group Hamas invading Israel on October 7, which Dr Chalmers said meant motorists would likely see even more severe petrol price rises.
'Weexpect some of these price pressures at the bowser to be potentiallyexacerbated by what we're seeing in the Middle East right now as well,' he saidon Wednesday.
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Treasurer Jim Chalmers(pictured right with Prime Minister Anthony Albanese) fears Australianmotorists could suffer even more pain at the bowser following a 20 per centsurge in petrol prices
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'Ofcourse, these CPI figures predate the escalation of the conflict in the MiddleEast.'
Motoristsare paying 48.8 cents a litre in fuel excise as a weaker Australian dollar, nowworth less than 64 US cents, makes imports more expensive.
PrimeMinister Anthony Albanese is being warned he faces losing the next electionunless the cost of living crisis is resolved - with rents surging bydouble-digit figures in almost every state capital city.
ButDr Chalmers has, for now, downplayed the prospect of halving the fuel tax likethe previous Coalition government did in March 2022 shortly before losing thelast election.
'Petrolprices were higher in the quarter, largely as a consequence of decisions takenby suppliers on the other side of the world but impacting Australian motoristshere at home,' he said.
'Werecognise that, that's why we're rolling out this cost-of-living help and it'swhy we are encouraged to see that it is working.'
FormerLiberal treasurer Josh Frydenberg in his last Budget halved excise for sixmonths to 22.1 cents a litre, based on the old rate of 44.2 cents.
Inanother headache for Labor, electricity prices surged by 18 per cent annuallyin September, even though Prime Minister Anthony Albanese went to the lastelection promising to reduce average power bills by $275 by 2025.
ButDr Chalmers argued that without rebates of up to $500, in the May Budget,electricity bills would have been even worse, citing the Australian Bureau ofStatistics giving credit to the Energy Bill Relief Fund rebates.
'Withoutour energy relief, they would have gone up 18.6 per cent,' he said.
'Nowwe know that people are still under pressure, but these are encouraging numberswhen it comes to the impact of our cost-of-living plan.
'Andthis is not the government saying that our cost-of-living plan is working, thisis the Australian Bureau of Statistics saying that the government'scost-of-living plan is taking some of the edge off these cost-of-livingpressures.'
Butgas and electricity prices went up by 12.7 per cent, even though the federalgovernment in December 2022 intervened in the gas market and capped wholesaleprices at $12 a gigajoule for a year.
Shadowtreasurer Angus Taylor suggested it was out of touch to argue Australians werebetter off under Labor.
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Australia's cost of livingcrisis is getting worse with inflation in the year to September remaining highat 5.4 per cent - sparking fears of a November interest rate rise (pictured isa Sydney service station)
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This predated terrorist groupHamas invading Israel on October 7, which Dr Chalmers said meant motorists werelikely to see an more severe petrol price rises (pictured are Palestinianscelebrating the destruction of a destroyed Israeli tank on the Gaza Strip)
Big price increases in September
PETROL: Up 19.7 percent
ELECTRICITY: 18 per cent
GAS: 12.7 per cent
TRANSPORT: 9.4 per cent
BREAD, CEREAL: 8.9 per cent
INSURANCE, FINANCIAL SERVICES:8.6 per cent
DAIRY PRODUCTS: 8 per cent
Source:Australian Bureau of Statistics annual increase in September, monthly inflationseries
'Forthe treasurer to suggest that Australians are better off is completely out oftouch,' he said.
Threeof Australia's Big Four banks - Commonwealth Bank, ANZ and NAB - are nowexpecting a Melbourne Cup Day rate rise, following the bad inflation numbers.
Anotherrate rise on November 7 would take the Reserve Bank cash rate to a 12-year highof 4.35 per cent and mark the 13th increase in 18 months, as part of the mostaggressive pace of monetary policy tightening since 1989.
