Petrol prices have soared to record highs in bowsers across Melbourne, reaching above $2.25 per litre, as the financial impact of Russia’s war on Ukraine continues to bite.

The Age contacted a number of petrol stations in Melbourne’s north on Monday, who confirmed prices had gone up by between 20¢ and 40¢ since the weekend.

Data compiled by the RACV also confirmed prices had reached their highest point in the past 30 days, with petrol stations in Brighton and regional Maldon among the state’s dearest.

EnergyQuest chief executive Graeme Bethune said motorists should brace for elevated prices to remain for the foreseeable future, caused by Australia’s weak currency, ongoing supply shortages due to sanctions on Russia and a snap-back in demand for travel.

“There’s a whole mishmash of factors, most of which point to prices being stronger for longer,” he said.

The former federal government intervened in March to halve the 44¢ per litre fuel excise to relieve cost of living pressures ahead of the May election.

The reduced excise will only last for six months, after which prices will climb by 22¢. Bethune said there was little the government could do in the short or medium-term to reduce prices. “It’s a global issue and part of the response to the Russian invasion.”

In the long term, however, he said governments could seek to address prices by reducing demand by encouraging electric vehicle take-up and changing planning laws to encourage “car-free CBDs” and improving funding for better public transport.

KPMG senior economist Dr Brendan Rynne said the Singapore Mogas 95 petrol price, used for benchmarking petrol prices, has increased 67 per cent since the start of the year, and would remain elevated until at least 2024.

“The likelihood is we’re going to experience high petrol prices for some time,” Rynne said. “We’ve got circumstances where global demand is increasing as everyone comes out of COVID but we’re just not producing enough to meet demand.”

But petrol prices aren’t the only household item spiking. The Reserve Bank will meet on Tuesday to determine whether to increase the cash rate again.

Rynne said he expects the RBA will increase the cash rate by 25 basis points, although warned this will likely not filter through to lower prices immediately.

Inflation is driven by demand, supply and wages and Rynne said all three had combined to create higher prices for longer. “We’re at the beginning of a two-year inflation cycle, at least.”

Extracted in full from: Melbourne petrol prices spike above $2 per litre (