Despite being a resource-abundant country, Australia is dependent on refined oil products imported from around the world.
Australia is 80-90% dependent on imported refined products. Strategic reserves stood at 37 days before the Iran war. The ongoing Middle East conflict has left Australia scrambling for fuel.
Disruptions at the Strait of Hormuz and export restrictions by major Asian suppliers have triggered the unraveling fuel crisis. South Korea has restricted exports to Australia, particularly for diesel, which has experienced the greatest supply deficit.
The energy minister confirmed six tankers from Malaysia, Singapore, and South Korea have been deferred or cancelled. Current arrivals left before the war and disruptions began.
Australia has turned to the US as an emergency supplier despite the longer transit times and expensive freight costs.
To avert a total crisis, the Australian government has released about 4.8 million barrels of diesel and gasoline from its strategic reserves. However, Australia has low stockpiles, which are below the IEA threshold, meaning the intervention cannot be sustained.
Another option has been to relax fuel specification to widen supply options over the next six months. A broader range of fuels will enter the market to ease the prevailing situation.
