This week, petrol prices crept towards $2.40 a litre around the country, while in regional Australia, petrol stations are rationing fuel, with some running out entirely. For Australian families planning Easter holidays in early April, the timing could not be worse. What started as excited bookings and itinerary planning has turned into a budget crisis, forcing households to make hard choices about whether they can still afford the road trip they planned.
Petrol prices have jumped 50 cents a litre from $1.69 to $2.19 on average across Australia since the start of the US-Iran war. Iran's naval blockade of the Strait of Hormuz, through which one-fifth of the world's fuel supply passes, has exposed a structural vulnerability in Australia's energy security. The country imports roughly 90% of its fuel, mostly as refined product from South Korea, Japan, Singapore, Malaysia and Taiwan.
The impact on holiday plans is already visible. One caravan park owner said his business went from fully booked over the Easter long weekend to having vacancies to fill, with people from Sydney pulling out because of fuel uncertainty. Tourism operators report that everyone is getting jittery coming up to Easter school holidays, with more inquiries than usual about cancellation policies.
Rather than abandon the holiday season entirely, many families are making practical adjustments. Instead of long-distance adventures, travellers are choosing shorter trips to destinations closer to home, with two hour radius holidays becoming more popular while long coastal drives or remote outback trips are declining. Some lodge vacancies are being filled by local residents with caravans and motorhomes who still want to enjoy a getaway but without the added price of travelling afar.
Regional tourism operators are not sitting idle. Reflections Holidays, which has 40 holiday parks across NSW, announced that all guests will receive a $25 credit to help ease some of the financial stress of travelling. These initiatives signal recognition that the industry itself has a stake in encouraging people to keep travelling, even if it is closer to home. Governments, the NRMA and other economic experts have urged people to continue travelling to regional NSW, including over Easter, noting that cancelling a road trip will only cause financial harm to small towns that rely on tourism dollars.
The bigger picture points to a genuine tension between household budgeting and economic support for regional communities. The Australian tourism industry has been particularly affected, with higher petrol prices prompting many holidaymakers to reconsider their Easter travel plans, and while some Australians may opt to drive to avoid costly flights, they are still facing record high fuel prices that could make road trips more expensive than expected.
For the moment, prices in Sydney, Melbourne, and Brisbane are currently in the rising phase of the petrol price cycle with averages expected to continue climbing over the next 7 to 10 days before reaching a peak, while Adelaide has seen an exceptionally rapid increase suggesting its peak may arrive sooner than the other major capitals, with prices expected to stabilise and slowly decline over the next 3 to 4 weeks.
The Easter period will test both household finances and the resilience of Australia's tourism ecosystem. What is clear is that families are making rational economic decisions in response to higher input costs; caravan park operators are adapting their business models to compete; and governments have acknowledged a need to manage fuel supply carefully. Whether that combination is enough to sustain regional tourism through the holiday period remains to be seen.