Record-high fuel prices in Sydney, Melbourne and Brisbane may be 'here to stay', the NRMA warned on Monday in Australia, accusing some fuel stations of effectively price-gouging during the Middle East conflict and leaving motorists facing what it calls a 'permanent high point' at the pump.
The alarm over a new era of fuel prices follows weeks of disruption after fighting in the Middle East unsettled global oil markets and Australian supply chains. As the conflict intensified, wholesale prices climbed and many motorists rushed to fill up, while retailers in major cities lifted prices early in anticipation of further rises.
Why Fuel Stations Are Facing A Price-Gouging Backlash
At the centre of the row is a blunt claim from the NRMA's spokesperson, Peter Khoury, who argues that retail prices for households and businesses in the three largest east-coast cities are now effectively locked near record highs because some stations 'jacked up prices early in the conflict'.
'We are now in a permanent high point ... in those three cities,' Khoury said. 'The opportunity to crack down on that behaviour and just get them to, at the very least, hold their price – we missed it.'
The Guardian reported unleaded petrol has already pushed past 230 cents a litre in Darwin and Melbourne, with other capitals moving in the same direction, according to data from Informed Sources.
In New South Wales, the state government said that 32 of about 3,000 service stations were out of at least one fuel type on Monday morning. On paper that is roughly 1%, but officials acknowledged that when a town has a single servo, one dry pump can mean an entire community is effectively cut off.
Premier Chris Minns insisted there was 'enough fuel' in the system overall, but said shifting it to regional areas had become harder as drivers filled up more often at local stations.
'It's harder to restock those petrol stations if they've got more than expected out of the bowser on any given day,' he said, placing some of the pressure on motorists' behaviour.
How Fuel Stations Became A Regional Flashpoints
On the other side of the continent, Western Australia is seeing its own flashpoints. In the town of Manjimup, two service stations ran dry on Friday, while industrial fuel suppliers have reportedly limited sales to 10,000 litres per customer.
Local shire president, Donelle Buegge, said 'independent ones [stations] are probably doing it a little bit hard', contrasting their situation with that of BP, which she said was 'doing OK'. It is a small snapshot of a bigger pattern in which small operators absorb the shock first.
Regional and independent stations said they were finding it harder to access fuel after Ampol, BP, Mobil and Viva Energy prioritised regular customers and cut off smaller groups buying on the spot market. Some independents also stopped offering fuel they could no longer afford as wholesale prices caught up with the retail spike.
Fuel Prices, The Rural And The Urban Fallout
Behind the city forecourts, the strain is biting hardest in smaller towns and on farms.
In Victoria, the president of the Victorian Farmers Federation, Brett Hosking, said entire towns had 'run dry', naming Wedderburn and Bonnie Doon in the state's centre and Robinvale in the north-west. He described a practical dilemma for tanker drivers heading out of Melbourne as they pass through fuel-hungry suburbs and regional fringe stations.
'[Tankers] are going to find some fuel stations needing fuel very close to Melbourne and you're probably going to empty your truck into there and then go back for another load,' he said. 'How do you ensure that when you've got 100,000 city motorists crying out, saying "we need fuel too", how can you guarantee that [tanker] truck will keep driving past them.'
Hosking has called for formal rationing to be considered, despite acknowledging that any cap on purchases would be difficult to police. He is openly sceptical that companies, left to their own devices, will genuinely prioritise regional Australia, whatever the government's stated intentions.
At crisis talks in New South Wales, the president of NSW Farmers, Xavier Martin, warned that 'serious dysfunction' in fuel supply was beginning to threaten food production as farmers, villages and towns struggled to secure diesel.
'Tractors and trucks run on diesel not petrol, and there's been this huge focus on petrol ... those harvesters need thousands of litres a day,' he said. If they cannot get it, crops stay in the paddock and the effects ripple out towards supermarkets.
More Fuel-Related Challenges in Australia
In the regional city of Swan Hill, mayor Stuart King said Robinvale was currently full of temporary workers for the wine grape and almond harvest, some travelling up to 100 kilometres a day to reach farms. 'If you haven't got fuel, you can run out pretty quickly, which means then you can't get to work,' he said. Local stations have already restricted people from filling jerry cans or mobile tanks.
King has argued for a cut to the fuel excise, as seen in 2022, after prices in his area rose by about 30% in a fortnight. Yet analysis by the e61 Institute points out that such a move would hand greater benefits to higher-income households, which buy nearly twice as much fuel as the lowest-earning fifth of Australians.
Lower-income households already spend about 10% of their income on petrol, making them the most exposed to any sustained 'permanent high point', while being proportionately less helped by a flat-rate tax cut. The federal government has therefore ruled out revisiting the excise.
King said locals were cancelling trips to see family in Melbourne and young people were rethinking weekend sport because of the cost of travel. 'I've spoken to some young people over the weekend and they're saying ... "I don't think I'll be able to afford the travel and I'm already stretched as it is, so I might just work on Saturdays instead of playing sports",' he said, describing what he called a 'cumulative effect on community wellbeing'.
Urban Areas Not 'Immune'
Urban areas are not immune to physical shortages either. A 7-Eleven in Canberra's Holt suburb ran out of fuel over the weekend, with staff telling customers that sudden bulk-buying was to blame, although restocking was expected by Monday night. Another 7-Eleven in Phillip has been running low and customers were warned its supplies could run out by Monday evening.
The Albanese government has been keen to stress that Australia does not have a national shortage of fuel, only a distribution squeeze made worse by panic-buying.
In response, it has announced plans to inject millions of litres of additional petrol into supply chains and allowed companies to sell lower-quality petrol temporarily, while also releasing about a fifth of their mandatory stockpile.
