Australian drivers have had a small but welcome breather at the bowser, with fuel spending falling for a second week in a row. 

 

New Westpac data shows average weekly fuel spend dropped 3.8 per cent last week to $163.4 million¹. This followed a 17.9 per cent drop the week prior² to $169.8 million.

 

It is the first back-to-back decline since the Iran war began some fifty days ago and comes after several months where fuel prices moved steadily higher, adding pressure to household budgets.

 

Westpac Chief Executive, Consumer, Carolyn McCann, says that while the drop indicates lower headline prices are bringing some relief, the outlook remains uncertain. 
 
“Households have been under sustained pressure since early March, so seeing fuel spend fall back is a meaningful shift and suggests the fuel excise cut is landing in household budgets,” says McCann. 
 

“However, fuel costs are still higher than people were used to before the shock, and we’re starting to see the impact shift to some business sectors that are less able to pass costs on quickly.”

 

The average fuel transaction values rose 2.9 per cent week‑on‑week to $59.21, despite lower pump prices. This suggests a pull‑back in short‑term stockpiling behaviour, with spending increasingly reflecting essential fuel use rather than precautionary fill‑ups.

 

Fuel is just one part of the cost-of-living puzzle, but it carries outsized weight because it feeds into so many other expenses. Transport costs influence grocery prices, services and small business overheads, particularly in outer suburbs and regional areas where driving is essential.

 

Despite the recent easing, fuel spending remains higher than a year ago, up more than 16 per cent. For many households, especially those with variable-rate mortgages, any savings at the pump are likely being redirected to other unavoidable costs such as insurance, rent or energy bills.

 

Westpac’s April Market Outlook points to a consumer that remains careful and selective with spending. Essentials continue to dominate household budgets, while discretionary purchases stay subdued.

 

^{1 Weekly fuel spend w/c 6 April (Week 6 since the conflict broke out), compared to the same period the year prior.}

^{2 Week 5 fuel spend (w/c 30 March)}