Australian Fuel Prices: A New Normal of High Costs?
Australia's transport fuel prices have been skyrocketing in 2026, with petrol above $2 per litre and diesel nearing or exceeding $3 a litre in some areas.
The ongoing turmoil in the Middle East is the immediate cause of these high prices, but experts warn that this may not be a temporary crisis. Australia's fuel market is heavily influenced by international refined fuel prices, which are currently at record highs due to refinery capacity issues and regional demand.
The relevant benchmark for Australian unleaded petrol is Singapore Mogas 95, while diesel is based on Singapore Gasoil. These prices reflect not only crude oil costs but also factors like shipping and competition between countries for supplies.
Australia's economy relies heavily on imported fuel, with most vehicles requiring petrol or diesel. Even if international oil prices fall, it may take two weeks for the impact to be felt in Australia, due to supply chain delays. The exchange rate also plays a role, as a weaker Australian dollar makes imported fuel more expensive.
The temporary reduction of fuel excise during the crisis has been restored, adding an extra 18.8 cents per litre to prices compared to before August 3.