A petrol station in Sydney
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Australians may have to ration fuel as a “last resort”, according to an energy expert, as Prime Minister Anthony Albanese encourages people to avoid driving where they can.
The Grattan Institute Energy and Climate Change Program director Alison Reeve said the federal government will likely consider rationing fuel supply if all other contingencies fail.

The Australian government is diligently working to maintain an uninterrupted flow of refined fuel from Asian refineries, as these are the primary sources for the nation’s fuel. This assurance comes as part of Australia’s comprehensive four-point national fuel strategy, currently in its second stage, aimed at ensuring the country keeps moving smoothly.

A petrol station in Sydney
Australians may have to ration fuel as a “last resort”, according to an energy expert. (Photo by Bai Xuefei / Xinhua via Getty Images)
”If those supplies don’t end up being adequate, and that may happen because all of those refineries rely on oil from the Middle East, the second layer is that we start importing fuel from further away, so possibly from the US.

In this phase, the focus remains on securing supply chains without resorting to drastic measures. However, should disruptions persist and necessitate further intervention, phase four of the plan includes the possibility of implementing fuel rationing. This step would be considered only if deemed essential to safeguard critical services.

Despite these preparations, the federal government is keen on avoiding any measures reminiscent of the interventions seen during the COVID-19 pandemic. Officials have emphasized their commitment to preventing such scenarios and maintaining stability in fuel availability.

In addressing concerns, the government acknowledges the vital role of key sectors reliant on fuel, such as farmers, miners, tradespeople, and essential shift workers like nurses. Their daily operations are crucial to the nation, and the government is committed to ensuring they remain supported through these uncertain times.

The federal government has made it clear that it’s trying to avoid fuel rationing and any COVID-style interventions. 

But Albanese used his rare national address last night to advise people to switch to public transport if they can to save fuel for those who have no choice but to drive.
Prime Minister Anthony Albanese during his rare national address. (Alex Ellinghausen)

“Farmers and miners and tradies who need diesel, every single day, and all those shift workers and nurses, who do so much for our country,” he said.

Reeve said the remarks were a way to signal “well ahead of time” who would be exempt from potential fuel rationing measures.

“He’s building a social expectation around what the priority order will be without actually having to legislate it,” she said.

Australia currently has 39 days of petrol, 30 days of diesel and 30 days of jet fuel available and the federal government has secured fuel shipments through to May.

While the figures seem alarming on the surface, Reeve said the reserves are a buffer that can be extended if demand drops.

“If we drop fuel consumption by 20 per cent, the 30 days of diesel reserves will actually last for 150 days,” she said. 

The Strait of Hormuz.
The Strait of Hormuz. (Supplied)
The war in Iran seems far from over as US President Donald Trump today declared that operations will only intensify in the coming two to three weeks.

“They should take the lead in protecting the oil that they so desperately depend on,” he said in a national address.

“Build up some delayed courage, go to the Strait and get it, take it. Protect it, use it for yourselves.”

The global conflict has raised fuel prices past $3 a litre, caused panic-buying and left hundreds of petrol stations running low across Australia.

Reeve warned that supply chains and fuel prices will never go back to what they were.

Cars and trucks, inbound traffic on the Monash freeway M1. 7th March 2025,
The global conflict has raised fuel prices past $3 a litre. (JOE ARMAO)

“We will probably all adjust in the meantime,” she said.

“One of the things that happens, and this is similar to what we saw with COVID, it’s similar to what we saw in the 1970s and 80s with oil shocks, people actually permanently change their behaviour.

“People buy smaller cars, for example. The big option that we’ve got now is switching to electric cars. Maybe we start to use fertiliser differently.

“That actually means that things never go back to exactly the same set of supply chains and prices that you had before, but they’ll get to a new kind of equilibrium point where everyone’s got what they need, and that’s because the supply is adjusted, but also because the demand has adjusted.”

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