Aussies are warned the worst is yet to come as the global fuel crisis drags on.
Defence and National Security Consultant John Blackburn told Sunrise that prices at the bowser and pressure on food supplies are set to take a major hit in the coming weeks.
“The last of the oil that came out of the Strait of Hormuz, that went to the refineries in Asia, that then got distributed to customers, has arrived,” he told hosts Natalie Barr and Matt Shirvington on Monday morning.
“So, what we’re now going to start seeing is the impacts of that 20 per cent loss. And you’re going to have 100 per cent of the world’s demand trying to take what they can out of the 80 per cent supply.”
While Mr Blackburn praised the government’s reactive measures, such as subsidising industry spot prices and negotiating priority access with regional refineries, he warned it would not be a “long-term solution.”
“We’re going to have to reduce consumption,” he said.
“We have failed to prepare for this for at least the last 15 years.”
Mr Blackburn also warned diesel would be hit the hardest, ultimately impacting the entire supply chain, including products and food.
Beyond petrol, Aussies can expect shortages of chemicals and plastics exported from the Gulf region, with food packaging manufacturers already struggling to source adequate plastic materials.
“You’re going to see financial effects, supply chain effects that go beyond fuel and fertilisers,” Mr Blackburn said.
However, as of May 1, the government has secured two shipments carrying 100 million litres of jet fuel, and another shipment of 50 million litres of diesel.
These three new fuel shipments, going to Brisbane, Perth and Darwin, are in addition to the eight shipments already announced in partnership with BP Australia, Ampol, and Viva Energy, which will reach Australia in May and June.
Combined, the government has secured over 450 million litres of additional diesel and 100 million litres of additional jet fuel to make sure Australians have the fuel they need.
To shore up fuel imports and national security amid a global oil crisis sparked by the Iran war, the government has been seeking deals with Asian exporters of petrol and diesel.
Countries that supply Australia with much of its fuel, such as Japan, Malaysia and South Korea, depend on Australia as a major source of their gas supply and are also major investors in Australia’s huge gas export industry.
Australia imports about 90 per cent of its petrol and diesel, with most coming from Asian refineries, which source about 70 per cent of their crude oil from the Middle East.
Mr Albanese struck a deal with Malaysian Prime Minister Anwar Ibrahim during a visit to Malaysia just over two weeks ago, pledging to remain a reliable gas supplier as Malaysia said it would put Australia at the front of the queue for fuel exports.
On Sunday, Japanese Prime Minister Sanae Takaichi arrived in Canberra for a three-day visit framed around the 50th anniversary of the Basic Treaty of Friendship and Cooperation.
Energy supplies and defence are among the key areas Japanese Ms Takaichi will discuss with Mr Albanese on Monday.
Australia imports almost 8 per cent of its diesel from Japan, making the country crucial to government efforts to secure more supply for industry amid Iran war fuel shocks.
Japan, in turn, relies on Australia for up to 40 per cent of its gas imports.
In a piece in the Australian Financial Review this weekend, Ms Takaichi said she intended to “reaffirm with Prime Minister Albanese our two-way partnership on energy security, and for us to work together to contribute to energy stability across Asia.”
