Expert's advice to Aussie motorists concerned about fuel prices surging

7NEWS

23-06-2025

Australian motorists worried about tensions in the Middle East affecting prices at the pump have been sent a clear message: 'Fill up now.'
US President Donald Trump 's administration carried out an attack on three nuclear sites in Iran on Saturday.
It comes after Israel launched attacks on Iran earlier this month.
Oil prices are expected to rise as a result of the escalation in conflict, however experts have spoken out to ease fears of immediate surges.
'It's really important for Australians today to understand that what we have seen again over the weekend, while it is another escalation above and beyond the escalation we saw the weekend before it, this is the Middle East,' NRMA spokesperson Peter Khoury said.
'Unfortunately, flare-ups are all too often and all too common.'
The regional benchmark for oil in Australia, Tapis, is expected to increase in price by tonight, Khoury said.
'We don't know by how much,' he said. Based on what we're seeing out of the US, it could be $3 or $4 a barrel.'
Why could petrol prices rise?
A possible way for Iran to retaliate against the US and Israel is to close off the Strait of Hormuz.
The strait is a vital trade route used to transport 20 per cent of the world's crude oil, or about 20 million barrels per day.
The Iranian parliament has backed closing the strait in response to the US attacks, though this must be approved by Iran's national security council.
Oil prices could shoot above $100 per barrel if the strait is closed for a prolonged period, according to Goldman Sachs and consulting firm Rapidan Energy.
JPMorgan analysts view the risk of Iran closing Hormuz as low because the US would view such a move as a declaration of war.
US Secretary of State Marco Rubio on Sunday called on China to help prevent Iran from closing the strait.
Rubio said it would be 'economic suicide' for Iran to close the strait because the Islamic Republic's oil exports also pass through the waterway.
Currently, it remains open.
Khoury said this is 'the most important thing'.
'We do not want Australians panicking,' he said.
'Yes, there is speculation about what could happen in the next days and weeks, but it is the Middle East and anything can happen.
'The other important thing for Australians to know tonight is that if you live in Sydney, Brisbane, Melbourne, Adelaide or Perth, fill up now.'
A combination of prices being at or near the bottom of the cycle and turmoil in the Middle East mean now is the time to buy.
'Prices are either in the high $1.60s or in the low $1.70s,' Khoury said.
'That has everything to do with the domestic price cycles in those capital cities.
'The wholesale price in Australia has gone up about eight cents a litre since two Fridays ago when the escalation really flared up between Israel and Iran.
'It will go up again, is the expectation, based on the US decision to attack Iran over the weekend.
'But it's only gone up eight cents a litre in the last week and a bit.
'There's a lot of speculation about what could happen. It's really important that Australians focus on what is happening.
'And what is happening if you live in those bigger cities is that prices are pretty good.'
Khoury advised motorists to check fuel prices near them and find the best deal.
'You can find some real bargains,' he said.
'On any given day, there can be huge gaps in the price of the cheapest service station and the price of the most expensive.
'In Sydney today, it's 70 cents a litre.
'Regardless of what's going on in the Middle East or anywhere else, and regardless of where we are in the price cycle, do your research, use the information that you have access to that motorists in other countries don't have.
'We fought hard to get that made public. It's there for you to use.'
When asked when the conflict overseas will affect local prices, Khoury said it normally takes about seven to 10 days.
Our service stations are yet to buy the more expensive barrels but when that happens, it will have a flow on effect.
'The NRMA will be monitoring those prices really carefully over the next days and weeks, because what we won't tolerate, obviously, is oil companies manipulating what's going on overseas to put their prices up any higher than they should go,' he said.
Could we see a global oil crisis?
Khoury also emphasised that even if the strait is closed, it would not create a similar crisis to those caused by other recent global conflicts.
'In 2022, Russia invaded Ukraine, Russia being the second-largest producer of oil,' he said. 'That created an initial shock.'
'Obviously, the world was going to enforce sanctions, and they did. That created an even bigger shock.
'At the same time that that happened, the COVID supply crisis that affected the whole world hit its peak. So we all came out of COVID lockdown at the same time.
'The whole world came out of lockdown at the same time. Demand for oil spiked. Supply could not keep up. So we had probably the worst supply issue or challenge in our lifetime.
'And then Russia invaded Ukraine.
'All of those things had to happen at the same time for Tapis, our regional oil price, to hit $133 a barrel.
'It's currently at $76 a barrel.
'So to get back to those record high prices that we saw back in 2022, you would need a catastrophe at that level to affect global supply.
'We're not there yet, clearly, based on oil prices and the wholesale price.
'And I think that's what we want Australians to focus on tonight.'