Australia’s Fuel Excise Discount Ends August 2 as Petrol Hits $1.80

Australia’s fuel excise discount will end on August 2, 2026, removing 16 cents per litre of relief from petrol and diesel prices. Prime Minister Anthony Albanese confirmed the government has no plans to extend the relief, despite petrol climbing to $1.80 per litre in Melbourne and Brent crude spiking above US$100 a barrel. Drivers face steeper bowser costs as the discount lapses.

Excise discount expires next Sunday

The 16-cents-per-litre fuel excise cut was halved from 32 cents in July and is set to expire on August 2. Petrol and diesel prices have already surged sharply. In Melbourne, unleaded rose 6 percent to $1.80 per litre, while diesel jumped 12 percent to $2.17. Sydney’s average regular unleaded hit 171.5 cents per litre, up 10 cents, and diesel reached 209.2 cents per litre, up 22 cents, according to the NRMA.

PM rules out further relief despite pressure

Prime Minister Anthony Albanese told ABC’s Insiders program the government is not planning to extend the discount. Labor backbenchers including Rob Mitchell have urged him to reconsider as Middle East tensions drive oil higher. Albanese indicated fuel-related announcements are coming but did not specify what measures the government will pursue.

Oil prices surge on Middle East tensions

Brent crude oil prices soared above US$100 a barrel this week, the highest level since May, as fresh US-Iran tensions escalated. The NRMA expects fuel prices to rise further when the excise discount ends. Drivers have been warned petrol could exceed $2 per litre as the excise discount is wound back. Average unleaded prices across Australian capital cities have climbed from about $1.50 at the end of June to more than $1.80 in recent days.

What comes next for drivers

Albanese said the government will examine measures outlined in the budget but has not committed to new fuel relief. The excise cut was originally introduced in April for three months in response to rising prices from the US-Israeli war with Iran. With the discount ending August 2, Australian motorists will face full wholesale price exposure at the bowser for the first time in four months.

Final Thoughts

The fuel excise discount ends August 2, removing a key price buffer as global oil costs climb. With no extension planned and Brent crude above US$100 per barrel, Australian drivers should expect sharply higher petrol prices within days.

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