The opposition is proposing to cut the fuel tax in half when global prices hit $US100 over two weeks.
The Coalition says it will fund the measure through $8 billion generated from its planned cuts to the tobacco excise.
Treasurer Jim Chalmers dismissed the policy and said the government was not considering any future cuts to the fuel excise.
The opposition is promising to cut the cost of fuel when the global price spikes.
Under the policy announced today, the Coalition said it would halve the fuel excise when the global price of Brent crude oil reaches an average of $US100 a barrel over a two-week period.
Opposition Leader Angus Taylor said the initiative, called Fuel Price Shield, would be "fully funded" through the Coalition's policy of cutting back the tobacco excise.
The Coalition's policy to cut the tobacco excise by 80 per cent would raise $8 billion, according to modelling from the Parliamentary Budget Office.
Mr Taylor said the Coalition would also eliminate the 32-cent road user charge for heavy vehicles to take pressure off the cost of transporting goods.
Economist Chris Richardson said most economists have consistently said cutting the fuel tax is a "bad bandaid" that worsens inflation.
The government carried out a cut to the fuel excise, the amount of tax the government collects on patrol, from April 1 until the end of July this year.
The measure was extended until midnight on August 2, but a rate rise in the excise rate meant the discount was 16 cents a litre.