Australians will get temporary relief at the bowser after Prime Minister Anthony Albanese announced the fuel excise on petrol and diesel will be cut in half for three months, following a national cabinet meeting on the escalating fuel crisis.
The cut will reduce the excise from 52.6 cents a litre to about 26.3 cents a litre, with the change due to take effect from Wednesday.
Albanese said, framing the move as urgent cost-of-living relief,
“We’re making fuel cheaper today because we understand that Australians are under serious pressure.”
The measure is expected to cost the federal budget about $2.55 billion, with Treasurer Jim Chalmers warning the global economic fallout from the conflict is already being felt locally.
“The Middle East war is inflicting serious damage on the global economy and Australians are paying a hefty price,” Chalmers said.
“The steps that we’re announcing are all about taking some of the sting out of these higher petrol and diesel prices.”
The National cabinet also agreed to cut the heavy vehicle road user charge to zero for the same three-month period, a move aimed at easing pressure on trucking companies already struggling with cash flow and higher diesel costs. The broader package sits within a national fuel security plan that Albanese said was designed to ensure there is “one plan, not nine” across the Commonwealth, states and territories.
“For many small trucking companies that are small, they rely upon a cash flow which is under pressure,” Albanese said.
The current charge of 32.4 cents per litre will be reduced to zero, with the next scheduled increase also deferred for six months.
Energy Minister Chris Bowen confirmed legislation to support increased fuel supply would be introduced urgently, with the government seeking swift Senate approval.
“Australians want to know what’s being done to secure our international supply of fuel and oil, and we’re very pleased with the progress that we’ve made,” Bowen said.
The announcement forms part of a broader national fuel security plan agreed by state and territory leaders, designed to coordinate supply responses and ensure consistency across jurisdictions.
Albanese said the plan would create a unified national approach rather than fragmented state responses, outlining “how governments will work together to keep Australia open and to keep our economy going.”
Despite the ongoing cost pressures, the Prime Minister urged Australians not to cancel planned travel over the Easter period, stressing the importance of supporting tourism and regional economies.
“People should enjoy their Easter, and it’s important as well that we keep the economy going,” he said.
The government is trying to calm public concern while avoiding harsher restrictions. Treasurer Jim Chalmers said earlier on Monday that ministers wanted to avoid “COVID-style” interventions where possible, preferring coordinated national action and voluntary behavioural changes over sudden mandates. Albanese also said Australians should not scrap their Easter travel plans, stressing the need to keep tourism regions and the broader economy moving.
The temporary measures are expected to provide immediate relief at the pump, though questions remain about what happens when the three-month window ends and whether further support will be needed if global fuel prices remain elevated.
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