Australia’s fuel crisis driven by Iran war and Strait of Hormuz blockades
Consensus Summary
Australia is facing a worsening fuel crisis triggered by the Iran war and blockades of the Strait of Hormuz, a critical oil shipping route supplying 20-25% of global oil. As of mid-April, 470-500 service stations nationwide are without at least one fuel type, with shortages concentrated in Sydney and regional areas. The federal government, led by Prime Minister Anthony Albanese, is convening a second national cabinet meeting to coordinate a response, after states pressed for a unified approach. While the government has secured additional fuel shipments—replacing six cancelled tankers and adding three more—supply remains tight, with Asian refineries risking stock exhaustion within a month. Voluntary conservation measures, such as working from home and public transport discounts, are being considered as contingency plans, though rationing or drastic measures remain off the table. Fuel prices have spiked by 18-22 cents per litre, with the national average reaching nearly $2.40 per litre, straining households and industries. The government has temporarily relaxed fuel standards and released emergency reserves, but experts warn supply chains are fragile, and Japan has cautioned against a windfall tax on Australian LNG exports. States like NSW report worsening shortages, with diesel shortages spreading to metropolitan areas, while opposition parties and industry groups urge more aggressive action, including rationing and excise cuts. The crisis highlights tensions between federal and state coordination, with some sources noting past COVID-19 mismanagement as a cautionary example.
✓ Verified by 2+ sources
Key details reported by multiple sources:
- Anthony Albanese is convening a second national cabinet meeting on Monday (April 2024) to address the fuel crisis, following an earlier meeting on April 17.
- As of April 17-18, 470-500 service stations across Australia are without at least one type of fuel, with 32 stations in NSW alone out of fuel as of April 18.
- The Strait of Hormuz, a key shipping route for about 20-25% of the world’s oil supply, was blockaded due to US/Israeli strikes on Iran, contributing to global fuel shortages.
- The Australian government has secured additional fuel shipments: six cancelled tankers were replaced, plus three additional tankers, equating to six days’ worth of petrol and five days’ worth of diesel consumption.
- Energy Minister Chris Bowen announced the government released fuel from its emergency stockpile—six days’ worth of petrol and five days’ worth of diesel—as part of an internationally coordinated response.
- Fuel prices in Australia surged by 18.5-22.0 cents per litre last week, with the national average retail petrol price reaching 238.0 cents/litre (up to ~$119 for a 50-litre tank).
- South Korea introduced voluntary fuel conservation measures, including reduced shower time, charging EVs during the day, and running appliances on weekends.
- The federal government temporarily lowered fuel standards to allow more fuel into Australia and relaxed diesel flashpoint regulations to redirect supplies.
- Japan’s ambassador to Australia, Kazuhiro Suzuki, warned that a windfall tax on Australian LNG exports would be seen as a ‘bad surprise’ and could deter investment.
- Woodside Energy CEO Liz Westcott stated Australia’s gas export projects are operating at near full capacity, with limited ability to redirect supply for fuel shortages.
Points of Difference
Details reported by only one source:
- Treasurer Jim Chalmers conceded recent oil price modelling forecasting 5% inflation was ‘pretty conservative’ and asked Treasury to model more challenging scenarios.
- Opposition Leader Angus Taylor accused the government of not directing fuel stocks to shortages, stating ‘the stocks are there’ and calling for a coordinated national approach.
- The Australian Industry Group (AIG) called for fuel rationing, excise cuts, and discounted public transport, warning supply chains are becoming fragile.
- The Business Council of Australia (BCA) urged prioritizing fuel supply and supply chains while supporting public transport and carpooling.
- Senior government sources said the federal government is considering ‘light-touch’ voluntary measures like encouraging working from home for white-collar workers and using public transport, similar to South Korea’s emergency plans.
- Japan’s ambassador, Kazuhiro Suzuki, suggested Japan may consider swapping petrol for gas but downplayed the prospect, noting Australia supplies 40% of Japan’s gas.
- Energy Minister Chris Bowen dismissed Coalition criticism, stating ‘the opposition were “not serious people” and had offered no policy solutions’ while Labor temporarily dropped fuel standards and released reserves.
- Cabinet ministers privately downplayed the chances of Labor pushing ahead with a windfall tax on LNG exports, calling retrospective taxation ‘really bad news’.
- NSW Premier Chris Minns highlighted 187 stations in NSW were out of diesel (as of April 18), with 78 in regional areas and 109 in metropolitan Sydney.
- Minns explicitly rejected Covid-style emergency measures like lockdowns or home schooling but acknowledged preparing for ‘gradually worsening’ shortages in the weeks ahead.
- The article noted petrol prices reached nearly $3 per litre in Sydney and Melbourne, with fears they could hit $4.
- Philippine President Ferdinand Marcos Jr declared a national energy emergency that could last a year, contrasting with Australia’s cautious approach.
Contradictions
Conflicting information between sources:
- THEAGE reports senior sources say ‘it was not tenable to leave states to come up with individual plans’ during COVID-19, while NEWSCOMAU’s Minns explicitly rejects ‘Covid-style emergency measures’ like lockdowns or home schooling.
- ABC states the opposition claims ‘the stocks are there’ and calls for moving fuel to shortages, but THEAGE does not mention this opposition claim or the Coalition’s specific policy proposals.
- THEAGE cites Japan’s ambassador warning a windfall tax would be a ‘bad surprise,’ while ABC omits this specific warning and focuses instead on the Coalition’s criticism of government inaction.
- NEWSCOMAU reports 500 stations are without fuel (as of April 18), while ABC reports 470 stations (as of April 17-18)—a discrepancy of 30 stations.
- THEAGE mentions Woodside CEO Liz Westcott stating ‘very limited supply’ above current exports, but ABC omits this specific quote and focuses on broader industry capacity limits.
Source Articles
WFH, carpool: Albo’s plans to save fuel
The Prime Minister has called state premiers to a national cabinet meeting to discuss new emergency measures to conserve fuel....
PM calls second emergency national cabinet meeting over fuel crisis
States and territory leaders will convene next week to further coordinate the national response to the fuel crisis as the fallout from the Iran war continues to escalate....
Emergency measures on the table as PM calls fuel crisis national cabinet
Talks are under way inside the federal government about bringing the states together to create a consistent message on light-touch ways to save fuel....