Petrol Prices Set To Be Slashed For Aussies As A Fuel Relief Plan Hinted In Federal Budget

Your petrol price woes could be coming to an end, with the Federal Government planning to reduce the fuel excise in tomorrow's (March 29) upcoming budget.

Speaking to the ABC, Treasurer Josh Frydenberg all but confirmed that motorists will be given assistance at the bowser under a package of cost-of-living measures set to be announced on Tuesday night.

Some measures could come into effect as early as the middle of this week, with the Treasurer acknowledging high oil prices were a big contributor to Australia's cost of living.

Cost of living is expected to play a key role in Frydenberg's fourth budget.

REUTERS / Alamy Stock Photo

"Fuel prices have skyrocketed, and of course for many families this (using a car) is not a choice," he told the ABC.

"They need their car to get to and from work. They get into their car to drop their kids at school.

"These are costs that families are incurring and of course it's putting real pressure on their household budget."

The ABC reports that any reduction to the 44-cents-a-litre fuel excise would be a temporary measure, likely lasting to longer than six months.

While reducing the fuel excise would be a short term solution to help those struggling with the cost of living, it will take pressure off Aussies around the country. It will also cost the Morrison Government a pretty penny.

Analysis indicates that if the fuel excise was cut by 5 cents a litre, it would save motorists about $2.50 when filling a 50-litre vehicle. In that six months, it would cost the federal budget about $1 billion.

Simon Belcher / Alamy Stock Photo

If the government takes it even further by cutting the price by 10 cents a litre, Aussie drivers would save $5 on a standard refuel but it would set the federal budget back by a cool $2 billion over the six month period.

Fuel prices have been driven up by Russia's invasion of Ukraine on February 24.

The Treasurer said he recognises the issue of peaking petrol prices is at the forefront of many people's minds.

"The barrel of oil is up by 50 per cent since the start of the year, that's flowing through to the bowser here at home," he told Channel Nine.

"We recognise that pressure, we will be providing relief for cost of living on Tuesday night."

The petrol price cut follows the New Zealand government's move to slash the fuel tax for Kiwis, with the New Zealand Herald reporting that the cost of living across the Tasman has reached 'crisis' levels earlier this month.

The UK have also reduced their fuel duty by 5p per litre, a change that will remain in place until March 2023.

Topics: Australia