The fuel tax was halved by the former Morrison government to reduce fuel prices when the conflict in Ukraine caused them to soar above $2 a litre.

The temporary policy was in place for six months and ended on Wednesday night.

Treasurer Jim Chalmers said the tax cut, amounting to around 22 cents off every litre, was too costly to continue.

He said it would take a few days for higher prices to flow through as retailers would need to work through their supplies of discounted fuel first.

Chalmers also said the consumer watchdog would be looking out for retailers charging needlessly high prices.

“I have asked the chair of the Australian Competition and Consumer Commission to maximise their role in the petrol market to make sure servos and suppliers are not treating Australians as mugs,” he told reporters on Wednesday.

The NRMA’s Peter Khoury said fuel prices were already too high given oil prices had plummeted and the fuel excise had only just taken effect.

“We need to see a correction immediately,” he said on Wednesday.

-AAP