10 November 2026
Almost one-fifth of Australia's annual inflation came directly from rising petrol and diesel prices, highlighting the potential for electric vehicles to protect household budgets and reduce Australia's exposure to global oil shocks.
New analysis by Endgame Analytics for the Electric Vehicle Council finds that rising automotive fuel prices contributed 0.77 percentage points to Australia's 4.3% annual inflation rate in September.
With petrol and diesel prices up 23.6% over the year, the findings highlight a broader economic benefit of electric vehicles: reducing Australia's dependence on fuels whose prices are largely determined overseas.
"Petrol and diesel prices aren't just hurting motorists at the bowser. They're adding to inflation across Australia," said Electric Vehicle Council CEO, Julie Delvecchio.
"Electric vehicles give Australians a way to break that direct link with global oil prices. The more of our transport we electrify, the less exposed we become to future fuel price shocks and inflation."
EVs reduce exposure to fuel costs
To illustrate Australia's exposure to oil price shocks, Endgame Analytics modelled what inflation would have looked like if all household driving had been electric. After allowing for charging costs, annual inflation would have been around 0.6 percentage points lower. This is an illustrative scenario, not a forecast of overnight adoption.
When translated into running costs, rising fuel prices added an estimated $442 to the annual cost of running a small SUV 15,000km per year. By comparison, higher electricity prices added an estimated $48 to the cost of running an EV - around a tenth of the cost.
EV price moderation provides broad economic benefits
EVs are also getting cheaper to buy while rising petrol and diesel costs are pushing up the cost of living. List prices for the base models of Australia's ten best-selling EVs fell by an average of 3.1% in the year to September. Australia's cheapest new EV is now $19,990 driveaway.
More than 500,000 battery electric vehicles are now on Australian roads, and each additional EV sold reduces the number of households directly exposed to petrol price rises.
"Inflation is squeezing household budgets, and every rate rise adds to that pressure," Ms Delvecchio said. "The more Australians who drive electric, the less exposed households and the wider economy are to oil price shocks."
"Getting more Australians into EVs faster is good economic policy. That means keeping the New Vehicle Efficiency Standard strong, maintaining the FBT exemption and building more chargers."
Endgame Analytics Director Martin Chow said: "Our estimate compares the cost of petrol for household driving with the cost of the electricity needed to cover the same distance in an EV. It assumes charging costs 80% less than petrol, and excludes vehicle purchase prices and indirect effects, such as freight."
