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MINISTER for Climate Change and Energy Chris Bowen has told media today he understands why Australians are concerned about fuel availability, but insists the country’s diesel and petrol supplies “remain at this point secure”.

Minister for Climate Change and Energy Chris Bowen

“We have as much diesel in Australia today as we had before this crisis began, and the stock obligation which the companies are legally required to meet remains at 32 days,” Mr Bowen told a press conference at Parliament House earlier today.

‘A huge spike in demand, not an impact on supply’

“We are seeing a big increase in demand, particularly for diesel, and I understand why Australians are concerned, but my key message is that every single expected arrival of diesel supply in recent days and expected in coming days and weeks has arrived on schedule as expected, so there is no need for panic buying.

“Now, I do have a great deal of concern and empathy for those farmers in particular who, because of the situation with the supply chain in regional Australia are having difficulty getting diesel, but I do need to emphasise this is managing a huge spike in demand, not an impact on supply at this point.”

Mr Bowen and fellow ministers Julie Collins and Tim Ayres convened a roundtable earlier today with the National Farmers Federation, oil companies and peak industry groups such as Trucking Australia to discuss the fuel situation.

The meeting aimed to “ensure that the flow of communication between those groups is as strong as it could be”.

“The key message is, while there are challenges and uncertainties in all international supply chains at the moment, the preparations that the Government has put in place for the minimum stock obligation are working,” Mr Bowen said.

“If it’s necessary to access those minimum supplies, we will, but we’re not there at this point.

“And the important thing to know is that there is no need, no need to be concerned at this point about the supply of diesel or petrol of Australia, because our stocks are as high as they were before this crisis began, but we do need to work to ensure that as much as possible is flowing to farmers, because what the refiners are dealing with is a massive increase in demand.

“They are meeting their contractual obligations to those who have ordered diesel in advance, but they are having trouble meeting extra orders that are coming on the spot market because they are so high. But we’ll continue to work with them to ensure that as much as possible is being done.”

Government could invoke fuel rationing powers if supply crisis deepens

Mr Bowen said the Government would not hesitate to use the powers it has under the minimum stockholding obligation “if necessary if it helps the situation”.

But he reiterated: “We are not there yet”.

“I note that last night G7 Ministers met and agreed it was not the right time for an international release of oil. And that reflects our understanding of the situation as well.”

On fertiliser, Mr Bowen said Australia had a five-week stockpile of urea, bringing total available supply held by the private sector to around 12 weeks.

“So, that’s technical grade urea which supports AdBlue which is so vital for trucking.

“Fertiliser is a separate question and urea for fertiliser is a separate question.

“Again, we are talking to the National Farmers Federation. At this point supplies remain good, but of course we’ll continue to remain agile and work with the industry as necessary through Minister Collins and myself.”

The key question now is how long the war continues, and when oil tankers may again be able to safely transit the Strait of Hormuz.

If the stalemate stretches on for weeks, the Federal Government could potentially move to strict rationing of fuel.

“Essential Users” defined under emergency act

Under the Liquid Fuel Emergency Act 1984, in the event of “an actual or likely fuel shortage”, the Governor-General has the power to declare a national fuel emergency.

This would give the Energy Minister powers to control:

• Industry-held stocks of crude and liquid fuels
• Production by Australian refineries
• Fuel sales across Australia

The Act also allows some “essential users” to be exempted from rationing during an emergency, including:

• Australian defence services
• Ambulance services
• Corrective services
• Fire or rescue services
• Police services
• Public transport services
• State emergency services or equivalent organisations
• Taxi services

National Farmers Federation welcomes roundtable discussion

In a statement released this afternoon, the National Farmers’ Federation welcomed the opportunity to take part in the ministerial roundtable convened by Chris Bowen alongside Julie Collins, Tim Ayres and Catherine King.

“It was important farmers had a seat at the table and we will continue working closely with Government to ensure agriculture has reliable access to diesel and other critical inputs,” NFF president Hamish McIntyre said.

Now was the time for calm, considered and sensible actions during such uncertainty, he said.

“Farmers rely on fuel to get food and fibre from paddocks to plates and ports every single day. As we move into the winter cropping season, demand for diesel naturally increases as farmers prepare paddocks and plant crops.

“We are already seeing signs of tightening supply and rising costs for key inputs. If farmers can’t access reliable and affordable fuel and fertiliser, some may be forced to scale back plantings. That hits farm incomes, agricultural production and food availability.”

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Mr McIntyre said the roundtable discussion reinforced the importance of agriculture and the food supply chain being front of mind in decisions about fuel supply and distribution.

“The NFF is committed working with our members to ensure timely and accurate information is provided to them.

“This moment also underlines a broader challenge. Australian farmers remain exposed to global shocks because of our reliance on imported fuel and other inputs.

“We believe the Government must explore all options to better understand and protect local food and fibre production from vulnerabilities such as global conflict. We expect the forthcoming national food security plan to address exactly that.

“The NFF also strongly supports growing domestic manufacturing capability, including a local biofuels industry. A domestic low-carbon liquid fuels industry would provide economic benefits and diversification opportunities for farm businesses, while also strengthening Australia’s long-term sovereign fuel capability.”