Oil prices have dropped but Australian motorists should remain wary

Australian motorists should not expect an immediate drop in fuel prices despite Brent crude sliding to the lowest level in weeks.But there is the "potential" for some relief at the bowser soon, according to peak bodies.The global benchmark for oil prices has fallen by more than $2, its lowest since September 8.That comes as Australian petrol and diesel prices surge amid the Iran war.In recent weeks the RACQ reported some Queensland service stations were charging more than $2.40 per litre for unleaded and $2.90 for diesel.But other experts believe change may be on the horizon.Let's break down what's happening.Why are petrol prices so high?International conflicts in Iran and Ukraine have sharply decreased fuel exports from global producers such as Russia, Saudi Arabia and the United Arab Emirates.On Monday the International Energy Agency warned many refineries were "already stretched to capacity"."This leaves few available options to prevent a further tightening of supplies and higher prices in the coming months," it said.Attacks by the Iranian-backed Houthis on oil tankers have complicated export routes. (Houthi Military Media/Handout via Reuters)Australia receives most of its petrol from imports, leaving it "exposed to global disruptions", according to University of Sunshine Coast finance professor Sajid Anwar."Although Australia draws on multiple suppliers, including Singapore, South Korea and Japan, these sources sit within the same Asia-Pacific supply chain, meaning major regional disruptions could still affect supply," he said.The Albanese government's cut to the fuel excise ended on August 3."We were very clear that that was a temporary measure," Energy Minister Chris Bowen told 7.30 last week.What are the prices right now?NRMA spokesman Peter Khoury said prices had been rising but it had slowed in the past week or so.He points to Gasoil, our diesel benchmark, which fell from $200 a week ago to $174.But Mr Khoury said further global drops could take up to 10 days to flow into the retail market."We're now starting to see a stability within those prices, but we haven't gone back nearly as far as we'd like," he said.Unleaded pricesDiesel pricesDoes the Brent crude drop mean cheaper fuel?Brent crude was down from $US110 ($154) last week to w $US98 ($137) today but it was still higher than the pre-war average of $US72 ($101).The drop came as Saudi Arabia restarted operations at its East-West Pipeline, which was damaged in Iranian-backed Houthi attacks more than a week ago.But experts have warned Australian consumers against following these international markets too closely or "assuming the volatility is over".Swinburne University of Technology transport professor Hussein Dia said oil prices were "still extremely sensitive to developments in the Middle East"."For motorists, the key thing to watch is not whether Brent falls on one particular day, but whether lower crude and refined-fuel prices are sustained over the next week or two," he said."A useful way of thinking about it is that the global oil market may be turning the tap down on prices, but there is still fuel already moving through the Australian supply chain that was purchased when international prices were considerably higher."Dr Dia says Australians should look at the Singapore Mogas 95 benchmark for more accurate fuel indications.Dr Anwar agreed with that assessment."The recent decline in Brent is encouraging from a fuel-price perspective, but it is too early to conclude that it will translate into a sustained decline at the bowser," he said."If international crude and Singapore refined-petrol prices remain lower, some downward pressure should emerge over the next one to two weeks."However, given the continuing geopolitical risks, particularly around Hormuz and Saudi Arabia's alternative export routes, petrol prices are likely to fluctuate considerably as markets reassess the probability of either de-escalation or further disruption."RACQ principal economic and affordability specialist Ian Jeffreys agreed lower prices would depend on whether those prices were sustained."While we do not expect an immediate drop in prices, there is potential for fuel prices to decrease by up to 5 cents per litre across the state," he said.Fuel could decrease in price if the global drops are sustained. (ABC News: Keana Naughton)What have prices been like in the recent weeks?According to the Australian Institute of Petroleum, the national average for unleaded petrol was 227.3 cents per litre on September 20.For diesel, that price was 273.6 cents per litre.Here's how it has tracked previously:September 13: 211.1 cents and 257.7 cents for dieselSeptember 6: 205.5 cents and 252.9 cents for dieselAugust 30: 204.8 cents and 252.7 cents for dieselAugust 23: 201.6 cents and 248.3 cents for dieselHow do I find cheap fuel?Most experts advise consumers shop around for the cheapest deal.Mr Khoury said families embarking on school holiday trips could save more than $20 a tank, depending on where they filled up.Independent stations may have cheaper fuel than the bigger brands. (ABC News: Chris Taylor)"In any town where you're heading on a rod trip … there will be a decent spread of prices," he said."It is important families are getting the cheapest fuel they can."Fuel price comparison apps can help you locate the cheapest prices in your area.ABC/Reuters