The Australian government has halved the fuel excise on petrol and diesel for three months, reducing the cost by 26.3 cents per litre. The heavy vehicle road user charge will also be reduced to zero for the same period to assist truck drivers with global fuel price increases triggered by the war in Iran. These measures, costing taxpayers $2.55 billion, will take effect from April 1 and are expected to reduce the price of a 65-litre tank of petrol by $19.
The announcement followed a national cabinet meeting with state and territory leaders, who agreed to a four-point fuel supply action plan. Australia is currently at level two, 'keep Australia moving', having moved past 'plan and prepare'. Level three involves 'taking targeted action', and level four is 'protecting critical services'. Prime Minister Anthony Albanese stated that Australia is a substantial distance from level three, which would be triggered by ongoing supply disruptions.
Energy Minister Chris Bowen confirmed that Australia is still receiving expected fuel shipments and has been able to replace those that did not arrive. At level three, governments would implement measures to reduce fuel demand, while level four would ensure supply for critical users such as emergency services, utilities, and life-supporting services. NSW Treasurer Daniel Mookhey and Western Australian Premier Roger Cook confirmed that rationing measures would be considered at stage four.
Prime Minister Albanese expressed a desire for more certainty from US President Donald Trump regarding the objectives of the war in Iran, calling for de-escalation in the global interest. Treasurer Jim Chalmers anticipates headline inflation will reduce by half a percentage point by June 2026 but acknowledged Australians are paying a 'hefty price' for the conflict. The government will also delay an increase to the heavy road user charge by six months, costing an additional $53 million in lost revenue.
Mr. Chalmers said the fuel excise cut provides cost-of-living relief for people who cannot avoid driving long distances, particularly in rural and regional areas. The national cabinet also agreed to consider GST relief, though the government has a 'long way to go' to finalise the May budget. NSW Premier Chris Minns stated that 'nobody wants to profit' while people are struggling, and all states indicated they would forgo revenue windfalls from higher GST takings due to fuel price spikes.
Opposition Leader Angus Taylor outlined his test for the national cabinet, calling for a national plan and changes to the fuel excise to ensure greater fuel security.
