The main transport workers' union in NSW has called on the state government to scrap fares on public transport as more people ditch cars due to the rising cost of petrol.

With diesel reaching above $3 a litre in some parts of the country, and unleaded not too far behind, more people are using public transport to commute to and from work.

With higher inflation and interest rates also contributing to cost-of-living pressures, the Rail, Tram and Bus Union (RTBU) believes public transport fares should either be reduced significantly or temporarily removed altogether.

"We could reduce to nothing for a period of time, or drop it to 50 cents, which has worked well in Queensland," RTBU NSW branch secretary Toby Warnes said at a press conference in Sydney today.

"Get them out of their cars, give them cost-of-living relief, use the fuel where we need it."

Transport Minister John Graham quickly poured cold water on the idea, claiming public transport in Sydney was already priced fairly.

"Public transport is a good alternative if you are worried about fuel prices," he said without supporting the union's initiative.

The daily cap for adults using public transport in Sydney is $19.30 between Monday and Thursday, and $9.65 from Friday to Sunday and on public holidays.

Current estimates show Australians are paying about $30 more per tank of unleaded petrol and $70 per tank of diesel since the start of the US and Israel's war in Iran.

The government says oil shipments haven't been hugely impacted by the recent conflict in the Middle East, with federal Energy Minister Chris Bowen declaring only six of the 81 shipments of oil to Australia since the conflict began earlier this month have been cancelled.

He also quashed the idea of fuel rationing being required in parts of Australia, despite some petrol pumps running dry.

"The federal government does have powers, we are not contemplating to use any of those powers," he said.

He conceded there would be "bumps in supply".

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