One state MP has labelled the situation "absurd" and the motoring watchdog says it is unclear how long the market will continue to be "extremely volatile".

There was a gap of 51.7c/l at Port Stephens, 40.2c/l in Newcastle, 33c/l at Cessnock and 28.2c/l at Lake Macquarie on Tuesday.

The region's most expensive average price was 193c/l at Dungog - all other parts of the region had averages in the 160s or 170s.

A Port Stephens service station had the region's most expensive regular unleaded petrol on Tuesday - 211.9c/l.

Independent Lake Macquarie MP Greg Piper said the situation in his area was "absurd" and that he understood why motorists on the southern and western sides of the lake felt they were getting ripped off.

"The NRMA says the difference between the gate price and the bowser price should be about 10 or 12 cents, but today in Toronto and Morisset the difference is about 38 cents for a litre of diesel, unleaded or e10," he said on Tuesday.

"How do the fuel companies explain that? I totally accept that competition will often determine bowser prices, but in the case of Toronto we've got Ampol-Caltex, Coles-Shell and BP within a stone's throw of each other with Costco up the road and a sprinkling of independents. How much competition do we need before we get a fair go?

"The price of premium unleaded in Toronto today is 16 cents per litre dearer than it is at the same branded outlets at Belmont. Why?"

NRMA spokesperson Katrina Usman said motorists should "absolutely" shop around.

"Right now the price of regular unleaded fuel is continuing to fall with the current average for regular unleaded fuel in Newcastle sitting at 168.2 cents per litre," she said.

"While global fuel prices are trending downwards, the market remains extremely volatile and we're unsure how long this trend will continue."

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