A devastating blaze has broken out at one of Australia’s last two operational oil refineries, intensifying the nation’s fuel crisis, which is already strained by tensions in the Middle East.

Emergency services were dispatched to the Geelong Viva Energy refinery in Corio just after 11 p.m. on Wednesday. By Thursday morning, around 60 firefighters were still engaged in combating the towering flames, which reached heights of 60 meters.

A change in wind direction propelled smoke towards northern Geelong, prompting a watch and act alert for about a dozen nearby suburbs.

Residents in the affected areas were strongly advised to remain indoors and ensure their windows were shut tight to avoid inhaling the heavy smoke.

The alert level was reduced shortly before 5:30 a.m., though the situation remains dynamic.

A notification from the Country Fire Authority warned, “Smoke may still affect the area. Traffic disruptions are possible.”

The huge inferno will put a further strain on Australia as it grapples with a fuel crisis, with service stations running out across the country and diesel prices soaring above $3-a-litre. 

‘It will impact on production at this point, petrol rather than diesel and jet fuel,’ Energy Minister Chris Bowen told Sunrise.

The Geelong Viva Energy refinery burst into flames on Wednesday night and continued to burn out of control seven hours later

 Residents in surrounding suburbs were ordered to remain indoors and keep windows closed

‘But we’re going to continue to work closely with Viva and really monitor and work together on any impacts.’

About 30 refinery staff who were at the Geelong site at the time have all been accounted for and there were no reports of injuries.

It’s understood that critical infrastructure in the refinery’s motor gasoline area has been damaged.

‘We still haven’t got the full report of how bad it is, but it’s significant,’ AMWU organiser Tony Hynds told Sunrise.

‘I was just astounded that no one was injured, knowing how dangerous that area is and what could have potentially could have happened.’

The facility supplies 50 per cent of Victoria’s fuel and 10 per cent of Australia’s, putting out 120,000 barrels of oil a day. 

The cause of the fire remains unknown.

‘There will be an investigation but at this point, there are no suspicious circumstances,’ Bowen said. 

The blaze was still burning out of control eight hours later on Thursday morning

The Geelong Viva Energy refinery in Corio is one of Australia’s last remaining refineries

‘It all appears to be accidental.’

The facility has been in operation for seven decades and employs more than 1,100 workers.

The refinery also produces hydrocarbon solvents, marine fuel oil, low aromatic fuel, avgas, bitumen and high-quality plastic feedstock used to create food packaging, medical equipment and polymer banknotes.

US President Donald Trump announced on Wednesday the Strait of Hormuz was ‘permanently open’.

He had ordered a blockade to push Tehran back on the negotiating table after the US previously failed to reach an agreement with Iran during peace talks in Islamabad.

It remains unclear whether Trump was declaring the strait open to shipping traffic immediately or signaling an intent to reach a permanent resolution as peace talks with Iran continue. The Daily Mail has contacted the White House for comment. 

Trump said the Strait would be reopened after secret talks with Xi Jinping, claiming the Chinese president had agreed to stop arming Iran. 

‘China is very happy that I am permanently opening the Strait of Hormuz,’ Trump wrote on Truth Social. 

‘I am doing it for them, also – And the World. This situation will never happen again.’

Trump continued: ‘They have agreed not to send weapons to Iran. President Xi will give me a big fat hug when I get there in a few weeks.

‘We are working together smartly, and very well! Doesn’t that beat fighting??? BUT REMEMBER, we are very good at fighting, if we have to – far better than anyone else!!!’