Tue. Jun 18th, 2024

‘Nowhere else in the world’ has a petrol cycle like Australia. Here’s how you can save money

Tyler Mitchell By Tyler Mitchell Jun18,2024
The secret to saving money on fuel is all to do with timing, according to experts.
Australia’s fuel prices are largely influenced by things retailers have no control over like global supplies and exports, as well as taxes, and even global conflicts.

But understanding Australia’s unique fuel cycles can help customers identify better deals.

What is a fuel cycle?

Petrol prices move up and down in regular patterns in Australia’s largest capital cities, though not in Canberra, Hobart or Darwin in price cycles.
This refers to the price customers pay, not the wholesale price, and doesn’t apply to diesel.

The Australian Competition and Consumer Commission explains price cycles as “Petrol prices steadily decreasing for a period followed by a sharper increase.

“It is a movement in the retail price from a low point (or trough) to a high point (or peak) to the following low point.”
NRMA spokesperson Peter Khoury told SBS’ Cost of Living Secrets podcast the petrol price cycle is unique to Australia.
“There is nowhere else anywhere else in the world that has anything like this petrol price cycle.”
“What happens is that the service stations will cut their prices to encourage people to come through the door and then they’ll put their prices up and when they go up, that’s when they make their profit.
He said regardless of the price cycle, it is worth the time to drive a few kilometres to get cheaper fuel.

Prices in Australia aren’t regulated, the government doesn’t set the price. It has no influence on what the retail price will be, and each service station can set its own price.

So what you end up seeing, especially in the biggest cities, is gaps of 30 or 40 cents a litre just in the local suburb, often around the corner from each other.

How do oil prices impact petrol prices?

The Singapore price is what drives petrol prices in Australia as opposed to the global Brent crude price.
After the Ukraine war broke out and at various points in the Hamas-Israel war, this oil price spiked significantly.
According to Khoury, it takes “around seven to 10 days” for that spike to affect petrol prices for consumers.

“The reason for that is refinery, most of our fuel comes, almost all of our fuel now comes from overseas and a lot of that is also refined overseas.

“So by the time it takes to get here if the price goes up $5 a barrel today, normally around seven to 10 days, that would be equivalent to almost 5 cents a litre appearing at the bowser here in Australia.”

Does the type of fuel you buy matter?

Khoury said he is often asked what is the most efficient type of fuel to buy, but it is very dependent on what type of car you have.
“The manufacturer of your vehicle will tell you inside the fuel cap what type of fuel you should put in that vehicle, and we encourage you to listen to the manufacturer.
“What we always say to people is, if you can take regular and E 10, then feel free to fill up and save money and not pay that extra for the more expensive premium fuels.”

Khoury said NRMA testing shows that some cars may be able to travel up to 10 km or so farther on a tank of one type of fuel compared to another, but the difference is “negligible” and depends on the manufacturer.

What else can you do to save money on fuel?

Khoury’s advice is to take extra weight out of the car because it uses extra fuel.

“Make sure the tyre pressure is what it should be because low tyre pressure creates more drag, which means you are using more fuel.”

He also suggests not using the air conditioning if you don’t need it on and opening the windows instead.
However if you’re driving on a highway the windows should be up because it will create more drag at a fast speed.
“Don’t be a lead foot. That makes a huge difference. Drive sensibly.”

Khoury says if you do these things combined you can save “a lot of money” on fuel.

Tyler Mitchell

By Tyler Mitchell

Tyler is a renowned journalist with years of experience covering a wide range of topics including politics, entertainment, and technology. His insightful analysis and compelling storytelling have made him a trusted source for breaking news and expert commentary.

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