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.
Fuel prices have been steadily decreasing in Victoria since mid-November, with the average price for unleaded fuel in Victoria 122.8 cents a litre, while premium unleaded sits at 134.3 cents.
The Australian Competition and Consumer Commission said petrol prices would increase in the wake of an 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.
The best days to buy fuel in Melbourne are Mondays, Wednesdays and Fridays, according to the ACCC.
On Thursday some of the cheapest places to buy petrol were the National Lube in Carlton and 7-Eleven in Bacchus Marsh, with unleaded petrol at 118.57 cents.
Good deals for premium unleaded petrol could be found at BP East Malvern and BP Heatherhill (128.98 cents), while prices were considerably higher at BP Clayton South (143.99).
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."
Sydney is already experiencing a taste of what's to come. The average price for premium unleaded in NSW is already a staggeringly high 144.7 cents a litre (compared with the 134.3 to 140.2 cents in Melbourne).
"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," Mr Sims said.
Here is what the ACCC says is happening in the petrol markets of Australia's major capital cities:
In Melbourne, petrol prices peaked early – 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 cents per litre (cpl).
Daily average RULP retail prices and terminal gate prices (TGPs) in Melbourne Photo: ACCC
In Sydney, E10 petrol prices peaked on December 11, 2016, around 130 cents a litre before decreasing to around 119 cents on January 3, 2017. Prices have started to increase at some service stations in Sydney.
Daily average E10 retail prices and TGPs in Sydney. Photo: ACCC