A PETROL price war is brewing for the school holidays as an independent retailer drops the cost of E10 by 6¢ a litre from today.

The move means the price of E10 will tumble well below the cost of unleaded fuel to just 1.06¢.

Queensland’s peak motoring body yesterday welcomed the move by United Petroleum and said it expected other servos to follow suit.

“We know competition drives down prices,” RACQ head of communications Renee Smith said.

“We hope it drives down E10 prices right across the board.

“To date, there hasn’t been enough difference between the price of E10 and regular unleaded. There hasn’t been that bang for buck there to entice motorists to use E10.”

Ms Smith encouraged motorists to capitalise on the cheap E10, which yesterday averaged 111.6¢ in Brisbane.

“It’s definitely the time to fill up in southeast Queensland,” she said.

“Prices may not be low for the whole of the school holiday period and can rise at any time.

“If motorists fill up at the right time, they can save hundreds of dollars a year.”

United Petroleum CEO Gary Brinkworth said the campaign aimed to get motorists to consider biofuel as a preferred option over unleaded fuel.

“United shares the Queensland Government’s vision for a sustainable biofuels sector,” he said. “All of our research and feedback . . . has clearly identified that price is the key driver for E10 purchases.

“E10 is a Queensland-made biofuel and now Queensland motorists get a Queensland-only discount price.”