Are Fuel Prices Hurting Your Wallet

Are Fuel Prices Hurting Your Wallet?

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‘A significant decline in passengers’ is a statement that public transport operators around Australia have been saying since the beginning of the pandemic.

Commuters are opting for private vehicles instead of public transport. While private vehicles help reduce the spread of COVID, it comes with a price - and we're talking about petrol.

Most centres around Australia report a 50-60% increase in the price of petrol since the depths of the pandemic in March - April 2020.

But there are answers.

Find out more about petrol prices.
Fuel prices differ by petrol types - we explain.
EV drivers don’t have to worry about fuel prices, you might be driving one soon too.
Saving money on fuel prices is just one way to cut costs.

In this article, we take a look at how you can drive for cheap - or cheaper, at least.

Firstly, Registration

Always a pain word for motorists, registration is one of those unavoidable parts of car ownership.

Rego costs can make a big difference when calculating and comparing car loans and sales prices as motorists factor in running the vehicle. Many states in Australia offer discounts when drivers renew their registration for 12 months rather than three or six months. Although you’ll have to part ways with a large sum of money once a year, the savings can make a big difference.

For example, registering a V6 SUV in South Australia;

  • Roughly $210 for 3 months - or, $840 over a year.
  • Roughly $790 for 12 months

Save $50

Running the same type of vehicle in Queensland;

  • Roughly $237 for 3 months - or, $948 over a year.
  • Roughly $931 for 12 months

Save $17

It’s not just rego costs that make drivers shudder. Here’s how to cut down on your fuel use.

Unnecessary Cargo. Cost: 1% per 25kg

The average midsize car’s fuel consumption increases by around 1% for every 25 kilograms of weight it carries.

1% may not seem like much but it can really add up. With 3 adult passengers plus the driver and a few bags, and your fuel economy is over 10% worse.

Make sure you’re not carrying around sports gear, tools or other items that you don’t need to access regularly. Even though cargo capacity can impact decisions when buying a car, consider how much you need to carry in your daily life. The lighter the vehicle, the less fuel you’re going to use.

A/C. Cost: up to 20%

Air conditioning is pretty much a must when driving in Australia, especially in the summer months.

Depending on the vehicle and outside temperature, air conditioning can cost fuel consumption by up to 20%. Just like carrying extra cargo, you’re asking your car to do more work - transport you around and keep you cool.

To reduce the fuel consumption, and ultimately the fuel prices you pay, use the recirculate option when your A/C is on. This means the car is cooling the already cooled air inside the vehicle.

When using the air from outside (non-recirculated air) on a hot day, you’re asking your car to constantly cool hot air - a tall order on a 40+ degree day in Aussie summer.

Aggressive Driving. Cost: up to 40%

Other than an increased chance of accidents, fines and a loss of their dignity, aggressive drivers also suffer high fuel prices. It means hard accelerating, braking, cutting in and out of lanes and weaving through backstreets to avoid congestion.

In stop-go traffic, aggressive driving can cost from 10% up to 40% in fuel consumption and 15% to 30% on highways.

The solution; watch other aggressive drivers stop to buy petrol more often (and probably pay more fines) while you keep calm and more money in your pocket.

Tyres. Cost: 0.3% per 1% decrease in tyre pressure

Often overlooked when it comes to saving fuel, tyres play a role in keeping your car fuel efficient. Under-inflated tyres increase rolling resistance or drag on a car’s ability to move along the road. This increases fuel consumption.

Estimates put the cost at around 0.3% worse fuel economy for every 1% decrease in tyre pressure.

What tyre pressure should your car use? Check on the tyre placard – often found in a door jamb or in your owner’s manual (or simply Google it). If in doubt, use an air hose at a service station to check.

More costs. Incorrectly inflated tyres typically have a shorter lifespan too. This means not only are you paying more for petrol, but you’re also paying more for tyres.

Wheels. Cost: up to 10%

A car’s wheels need to be realigned periodically. When your wheels are out of alignment, you might notice the vehicle slowly veering to one side. Not only is this dangerous, but it also causes tyres to wear much faster and poorer fuel economy.

Misaligned wheels can cost as much as 10% of fuel consumption.

Fuel Price Cycles

In Australia, capital cities and most population centres see fuel prices fluctuations known and fuel price cycles.

Naturally, filling up when the price is low is the way to go. The difference between a low, or trough, to a peak, can be 50 cents or more. Peak-to-peak times can vary per city, for example, Sydney typically sees a cycle every 4 to 4 weeks, Perth cycles are much shorter at around a week.

Why? As stated on the ACCC website ‘Price cycles are the result of deliberate pricing policies of petrol retailers, and are not directly related to changes in wholesale costs’.

In other words, competition between retailers plays a significant role in the cycles. Check the ACCC’s website for more information on fuel prices.

At the time of writing, Sydney’s 91RON unleaded fuel price cycles range from a peak of about $1.65 to a trough of around $1.25.

If you fill up an 80-litre tank;

  • Peak fuel price: $132
  • Trough fuel price: $100

Fuel Prices in Practice

Taking all the above into account is pretty tough for the average driver - always driving perfectly calmly, minimal A/C, perfectly inflated tyres and filling up only on a fuel price cycle trough.

However, applying just a few of the above to your driving routine can save hundreds, if not, thousands of dollars each year.

If your car is too expensive to run or just not keeping up with the modern fuel economy, getting into a new vehicle might be the best answer.

Start with a pre-approval from Positive today, it only takes a matter of seconds. You can also compare car loan rates here to know the best option that suits you.

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