Australia to halve fuel tax in response to Middle East war

Australia will halve a fuel tax to help motorists experiencing soaring petrol prices due to war in the Middle East, Prime Minister Anthony Albanese said Monday.

Albanese announced the step after meeting with the leaders of Australia's states and territories on Monday, agreeing a plan to tackle fuel shortages as the war in the Middle East continues.

Australia charges a sales tax of 52 cents on each litre of petrol sold at the pump, which will be halved for three months. 

The measure will cost the government $1.75 billion (Aus$2.55 billion), officials said.

"We are making fuel cheaper today because we understand that Australians are under serious pressure," Albanese said. 

Albanese's government has sought to reassure motorists that shipments of fuel continue to arrive in Australia, and petrol shortages in rural towns stem from panic buying and distribution bottlenecks.

Victoria and Tasmania states have made travel on public transport free, and Albanese urged motorists nationally to do what they can to conserve petrol by driving less.

"The less fuel we use in the cities obviously the more we can redirect to regionals areas that are under pressure," he told reporters in Canberra.

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In New South Wales, state Premier Chris Minns said there were scores of petrol stations without any fuel, and the focus was on helping rural towns.

"If the situation gets worse, we will take extra measures," he said.

Australia's national parliament on Monday introduced a bill to give powers to the government to underwrite the purchase of shiploads of fuel that will add to supply in Australia. 

Weekly data released by the government showed Australia has 39 days of petrol, a small increase on the previous week, and 30 days of diesel supply.

The government will also reduce costs for trucks by cutting a heavy vehicle road user charge.

The Fuel Check monitor showed average petrol prices had leapt from Aus$1.82 in February to Aus$2.48 on Monday in New South Wales, with diesel reaching Aus$3.

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