Australians are cutting back on dining out not because they can’t afford meals, but because the fuel crisis made them feel financially unsafe

Australians are spending less on dining out, not because they can’t afford a meal, but because rising petrol prices and interest rates have made them feel financially unsafe. Payment data from Commonwealth Bank shows households are cutting back on restaurants, travel, and home improvement to absorb higher fuel and energy costs. The shift is most visible in dining choices: consumers are skipping entrees, drinking tap water instead of wine, and opting for cheaper dishes like chicken schnitzel over rib-eye steak.

The change followed a spike in petrol prices after the US and Israel launched strikes on Iran, triggering oil market volatility. That surge coincided with a March interest rate hike. Together, they eroded disposable income and deepened financial anxiety. National Australia Bank’s April consumer sentiment survey recorded a sharp drop in discretionary spending, with consumers reducing even small indulgences like coffee and snacks—categories usually resilient in mild downturns.

Restaurants are feeling the strain. John Hart, president of the Restaurant & Catering Association, said venues reliant on day-trippers—especially coastal and vineyard eateries—are seeing fewer visitors. People are no longer driving until they’re hungry. They’re calculating every kilometre.

The Westpac-Melbourne Institute consumer sentiment index recorded its sharpest monthly decline since the start of the pandemic. Matthew Hassan, Westpac’s head of Australian macro-forecasting, said consumers are bracing for a return to the prolonged financial pressure of the pandemic inflation surge. Many never left it. Kirsty Robson, a senior financial counsellor at Consumer Action, said households are turning to buy-now-pay-later services and gift cards to pay for petrol and groceries. The response wasn’t just caution. It was a signal: they were already on the edge.