Petrol prices in parts of NSW could climb to more than $1.60 a litre as COVID restrictions ease, according to the NRMA.
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Sydney prices have climbed as high as $164.9 cents for a litre of unleaded and the motoring body has concerns more areas could follow that lead.
"Prices in the Illawarra aren't as low as we would like to see them," the NRMA's Rebecca Page said.
"We are worried that they will start to follow Sydney's high trend. We've got some service stations in Sydney that are really taking advantage and they've got really high, exorbitant prices and we don't want to be seeing anything like that in the Illawarra."
Ms Page said it was more likely the region's prices could go into the 150s than breaking the $1.60 ceiling.
Prices in the Illawarra this week have ranged between 124.9 cents and 149.9 cents, with most stations in the high 140s.
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Ms Page said the rising petrol prices were due to the demand for fuel exceeding supply as COVID restrictions ease and people look to get out and about.
"It's a huge sign of economic recovery," Ms Page said.
"That is a good thing in general, however for motorists it also means prices are creeping up."
As motorists saw an end to the low fuel prices due to COVID, Ms Page said it was important to look for the independent service stations, which often had lower prices.
"We need to be supporting those small guys who are keeping the prices down, because we want that competition to stay strong," she said.
"We want motorists to be supporting the cheaper retailers so that those retailers who are keeping their prices high have no option but to follow suit and drop their prices as well."