Petrol tipped to pass $2 a litre when the fuel excise cut ends on Sunday
Anthony Albanese has ruled out another extension and announced a $4 million study into building Australia's first new oil refinery since the 1960s.
The fuel excise discount ends at midnight on Sunday, and drivers have been warned petrol will push past $2 a litre.
Melbourne is already averaging about 190 cents.
The last 16 cents of relief disappears on Monday, when the excise snaps back to its full indexed rate of 52.6 cents a litre on petrol and diesel.
Labor halved the excise from April in response to the US-Israeli war on Iran, saving drivers 32 cents a litre, then extended it through July at half that.
Anthony Albanese has ruled out extending it again.
"That's not in our planning at this point in time," he told the ABC's Insiders on Sunday.
Brent crude went above $US100 a barrel this week for the first time since May, on fresh tensions between the United States and Iran.
On Tuesday the prime minister stood in Karratha with WA Premier Roger Cook and announced $4 million for a pre-feasibility study into a large-scale refinery in the Pilbara.
It would be the first built in this country since the 1960s, constructed by WA industrial company Perdaman, joining the two survivors in Brisbane and Geelong.
"Building an oil refinery here on the west coast would obviously build our resilience as a nation, as well as particularly benefit Western Australia," Albanese said.
The refinery would still run on imported crude.
Resources Minister Madeleine King said that was the point, because unrefined crude can be stored far longer than finished fuel.
There is potential for an oil discovery off the WA coast. It has not happened.
The Chamber of Commerce and Industry WA backed it, chief executive Will Golsby saying sovereign refining capability was vital as the world grew more uncertain.
Former BP regional president Greg Bourne, now a Climate Council member, said the numbers did not work.
"Building a refinery makes no commercial sense and that's why so many refineries have already closed," he said.
He said a new one would cost billions, take up to a decade to build and need ongoing subsidies, for no noticeable cut to Australia's reliance on imported oil.
Opposition Leader Angus Taylor welcomed it but said Labor could not promise a new refinery while its carbon tax was set to cost Brisbane and Geelong $165 million by 2030.
Australia imports about 80 per cent of its refined fuel and holds 42 days of petrol and 38 days of diesel.
The study is the first agreement signed under a $10 million program for refining feasibility work, part of a $15 billion fuel security package.
The refinery is a decade away at best, and it would still be fed by tankers.
The price rise lands on Sunday.