Victorian motorists are facing sky-high petrol prices, despite the government cutting fuel excise by half.

Prices in Melbourne peaked at as high as 242.9c per litre on Tuesday.

CEO of the Australasian Convenience and Petroleum Marketers Association, Mark McKenzie, says retailers are seeing two telltale signs that Victorians are feeling the pinch at the pump.

“We’re actually seeing is what we call product stepdown — so people who normally buy 98 are buying 95, and those who normally buy 95 are buying 91,” he told Stephen Quartermain and Elise Elliott, filling in for Ross and Russel.

“The other thing we’re actually seeing is that people are walking in, they’re seeing the price at the pumps and they’re not buying the non-fuel products they normally would.

“That’s another indication for us that people are under stress because of the prices at the pump.”

Press PLAY below to hear what Mr McKenzie predicts will happen to petrol prices in coming months