Petrol prices are now at their lowest since July 2007 following the latest cuts announced today.
In the 14th consecutive drop since prices peaked at 218.9c in July, BP, Shell, Caltex and Mobil cut prices by 4c a litre today, taking unleaded 91 down to 153.9 a litre.
Gull also cut its prices by 4c a litre, to 152.9c a litre for 91 octane.
Diesel prices remained unchanged.
Petrol prices have fallen 65c from their peak in July, said AA spokesman Mark Stockdale.
At current prices, it cost $650 less to run the average four-cylinder family car 14,000km a year.
It would cost $480 less a year to run the average diesel car.
"We don't know where it will all end. Obviously that's great news for motorists, and it's a reflection of just the falling international price for fuel which is continuing to plummet," Mr Stockdale said.
Oil prices were falling in part because of reduced northern hemisphere demand over winter, but mainly because of the world economic crisis. The price of oil had been boosted artificially high by speculators, and international commodity prices were now falling, he said.
Eventually the cost of the refined product would be uneconomical so producers would reduce supply, slowing down the price drops.
Also key was the exchange rate, which was well below its level in July.
"Our prices could be substantially lower if our exchange rate was back where it had been for a good portion of the last year," Mr Stockdale said.
"It's US20c under that now, which really translates to about 30c at the pump."
The international price of crude oil and refined petrol was currently lower than it had been the last time pump prices were this low, he said.
Diesel prices had not fallen as much as petrol because demand had not fallen, Mr Stockdale said.
