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The federal consumer watchdog is urging motorists to shop around and grab the cheapest petrol they see, with prices expected to jump in coming days.
But the average price for premium unleaded in NSW is already a staggeringly high 144.7 cents a litre.
The Australian Competition and Consumer Commission said petrol prices would increase in the wake of the Organisation of Petroleum Exporting Countries' (OPEC) agreement last month to cut oil production and with the Australian dollar falling against the greenback.
Its analysis of petrol sales found that demand surges in the lead-up to Christmas and drops significantly afterwards. Demand then picks up again in late January.
"Motorists are advised to consider purchasing now when petrol prices are relatively low or have not yet reached their peak, and not wait until they need to fill up," ACCC chairman Rod Sims said.
But the NSW government-run FuelCheck tool shows petrol prices are already painfully high, with the average price for Ethanol 94 at 129.5¢ a litre, Unleaded 91 at 130.6¢ a litre, and Premium 95 at 144.7¢ a litre at lunchtime on Thursday.
Consumers are being encouraged to use the FuelCheck app and website to find the best deals. For example, near Strathfield, the 7-Eleven in Croydon Park is selling Premium 95 for 127.5¢ a litre while Coles Express in Lidcombe is flogging it for 159.9¢ a litre - a difference of more than 30¢.
The ACCC said wholesale prices were at their highest levels since September 2015 due to increases in international crude oil and refined petrol prices.
The rises followed OPEC's approval last month to reduce oil production from January - the first supply cut in eight years. Russia and other non-OPEC nations also agreed to cuts.
"Along with the falling exchange rate, the OPEC agreements are the primary reason for increases in wholesale petrol prices over the past six weeks and why motorists are likely to see higher petrol prices in the near future," Mr Sims said.
"The OPEC cartel, therefore, continues to cause Australian motorists to pay much more for petrol than they should."
NRMA spokesman Peter Khoury said while there was no doubt there would be OPEC-related flow-on effects in Australia, petrol companies had already artificially inflated prices well before Christmas.
"My understanding is that the [oil production] cuts are only occurring in January, if indeed they go ahead. We expected there to be some increase in January as a result of OPEC but that increase came anyway, it came well before that," he said.
He said petrol companies were "ripping people off".
"Not only did we not get to the low point of the cycle we were expecting before Christmas, but it didn't take very long for a number of the major service stations to increase their prices quite significantly," he said.
"Overnight, a number of service stations increased their prices to 144.3¢, which is way too high, the terminal gate [wholesale] price is 20¢ cheaper than that.
"None of the capital cities got to as low as we thought they would over Christmas. In Sydney, we had a false spike yesterday when a number of service stations jacked their prices up by more than 20¢ a litre.
"Now more than ever you need to do research before you fill up."
The ACCC said in Perth, which had regular weekly price cycles, prices were generally at their lowest on a Monday and peaked on a Tuesday.
"With the regular petrol price cycles in Perth, motorists are encouraged to buy their petrol a day or two before Tuesday to take advantage of the cycles," Mr Sims said.
"The ACCC is concerned that petrol prices are increasing in Sydney, and those in Melbourne, Brisbane and Adelaide may increase in the coming days, so motorists should get in early, shop around, and consider filling their tanks before prices jump."
In NSW, which has an ethanol mandate, regular unleaded is used by about 22 per cent of motorists, premium unleaded 30 per cent, ethanol 18 per cent and diesel 30 per cent.
The ACCC revealed in November the government's controversial ethanol mandate was costing Sydney motorists up to $85 million a year.
"The ethanol mandate in NSW led to less choice and higher spending," the report said.
Here is what the ACCC says is happening in the petrol markets of Australia's major capital cities:
Sydney
In Sydney, E10 petrol prices peaked on December 11, 2016 at around 130 cents per litre (cpl) before decreasing to around 119 cpl on January 3, 2017. It appears that prices have started to increase at some service stations in Sydney.
Daily average E10 retail prices and TGPs in Sydney. Photo: ACCC
Melbourne
In Melbourne, petrol prices peaked significantly earlier – on November 17, 2016 – and have been decreasing very slowly since. Over the 46 days to January 3, 2017, petrol prices decreased by around 7 cpl.
Daily average RULP retail prices and TGPs in Melbourne. Photo: ACCC
Brisbane
In Brisbane, petrol prices peaked on December 14, 2016 at around 136 cpl before decreasing to around 131 cpl on January 3, 2017.
The ACCC is currently undertaking a market study into the Cairns petrol market and is looking at Brisbane petrol prices in that context. In addition, the ACCC has been informed by industry that additional costs associated with the introduction of the ethanol mandate in Queensland on 1 January 2017 may have had some influence on higher margins in Brisbane.
Daily average RULP retail prices and TGPs in Brisbane. Photo: ACCC
Adelaide
In Adelaide petrol prices peaked on December 6, 2016 at around 129 cpl before decreasing to around 122 cpl on January 3.
Daily average RULP retail prices and TGPs in Adelaide. Photo: ACCC
Perth
In contrast to the other cities, Perth has a regular weekly price cycle, with prices generally peaking on Tuesday and then decreasing to a low on Monday. The peak price on November 21, 2016 was around 127 cpl. The peak price of the latest cycle (on January 3, 2017) was around 139 cpl.
Daily average RULP retail prices and TGPs in Perth. Photo: ACCC
