{"id":939931,"date":"2026-10-25T02:50:14","date_gmt":"2026-10-25T02:50:14","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/939931\/"},"modified":"2026-10-25T02:50:14","modified_gmt":"2026-10-25T02:50:14","slug":"a-looming-fuel-shortage-could-smash-australia-and-no-its-not-petrol","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/939931\/","title":{"rendered":"A looming fuel shortage could smash Australia \u2013 and no, it\u2019s not petrol"},"content":{"rendered":"

It\u2019s harvest time in Queensland<\/a>. That means wheat, barley and chick peas heading for shelves and feedlots, and lots of diesel getting burned in harvesters, tractors and transport trucks. <\/p>\n

It\u2019s not a good time for experts to be warning the worst effects of the US war<\/a> in Iran<\/a> and Russia<\/a>\u2019s war in Ukraine<\/a> may be yet to come.<\/p>\n

\"A<\/p>\n

Barley is heading for shelves and feedlots.\u00a0Supplied<\/p>\n

You can see how badly the war is going in almost real-time \u2013 give or take a week or so \u2013 just by looking at the prices when you fill up with petrol.<\/p>\n

But, as Darling Downs grain grower Brendan Taylor knows only too well, in Australia<\/a> \u201cdiesel makes the world go round\u201d.<\/p>\n

\u201cWhat we produce, all our machinery, trucks, tractors, harvesters \u2013 they all run on diesel,\u201d the AgForce Grains president tells nine.com.au.\u00a0<\/p>\n

\u201cFor us to do whatever we do, we rely on diesel, and we can’t not use it.\u00a0<\/p>\n

\u201cAnd when the price of diesel goes up, it just makes whatever we do more expensive. So it just adds to our bottom line. It just adds to the cost of production.\u201d<\/p>\n

Oil prices have soared amid turmoil in the Middle East<\/a> as Iran reacts to the US and Israel<\/a>‘s February attacks by closing one of the world\u2019s largest oil transport corridors and flinging missiles at military<\/a> bases and refinery infrastructure in the region.<\/p>\n

More bad news: some of those hit the East-West pipeline Saudi Arabia<\/a> has been using to try to get around the blockade in the Strait of Hormuz.<\/p>\n

Meanwhile, Ukrainian drone attacks have hit Russian refineries, removing more of the global supply \u2013 even as US President <\/a>Donald Trump<\/a> tries to go around sanctions to do a deal for Russian diesel<\/a>.<\/p>\n

\"\"<\/p>\n

AgForce Grains president Brendan Taylor.\u00a0AgForce<\/p>\n

\u2018The toolbox is largely empty, leaving prices on the brink\u2019<\/p>\n

The US and Israel\u2019s initial attacks on Iran sparked warnings of oil prices surging to $US150 or $US200 a barrel.\u00a0<\/p>\n

Instead Brent crude peaked at almost $US140 \u2013 still double the pre-war price \u2013 as countries teamed up to flood the market with supplies from their stockpiles.\u00a0<\/p>\n

But University of Texas Professor of Public Affairs Joshua Busby and Georgetown University School of Foreign Service Adjunct Professor Greg Pollock warn those stockpiles are now substantially depleted and it’s not clear how much more oil they will be willing to release.<\/p>\n

\u201cThe international community has already taken most of the measures available to curb oil demand and boost its supply,\u201d they wrote in The Conversation at the end of last month.<\/p>\n

\"\"<\/p>\n

The war in Iran is having an impact on inflation but doesn\u2019t tell the whole story.\u00a0AP Photo\/Vahid Salemi<\/p>\n

\u201cThose moves have reduced the scale of oil price increases, but they did not prevent them entirely.\u00a0<\/p>\n

\u201cNow, the toolbox is largely empty, leaving prices on the brink of spiking again.\u201d<\/p>\n

Oil flows out of the gulf have improved in recent weeks but uncertainty is still hammering shipments, keeping prices high.<\/p>\n

The problem for Australia, and particularly farmers, is that the pain won\u2019t end at the pump.<\/p>\n

Australia\u2019s transport network is heavily reliant on trucks, which run on diesel, meaning any price rise flows broadly through most of the economy.<\/p>\n

Even before imported goods reach our shoes they have to travel by cargo ships, which also run on diesel.<\/p>\n

Farmers have to swallow a lot of the cost increases without passing them on but even if only transport is taken into account, they\u2019ve warned there could be price hikes at the supermarket.<\/p>\n

\u201cI sit on a couple of boards for my sins \u2026 and I’m seeing 20 and 30 per cent increase in trucking charges, which, if you’re working in retail<\/a> on a margin of, I don’t know, 20 per cent gross, that’s just unaffordable,\u201d John Kochanski, the chief marketing officer for circular carbon economy company meOH Energy, tells nine.com.au.<\/p>\n

\u201cAnd that’s going to impact \u2013 oh gosh \u2013 [everything to] shipping and coffee supplies.\u00a0<\/p>\n

\u201cIt just literally, I would argue that you would have a hard time identifying any part of the economy that’s not touched by diesel fuel.\u201d<\/p>\n

\"Shipping<\/p>\n

Shipping is affected by diesel prices.\u00a0Getty<\/p>\n

The fertiliser problem<\/p>\n

Then there\u2019s fertiliser. Before the war, Russia and Belarus supplied nearly a fifth of the world\u2019s fertiliser.\u00a0<\/p>\n

Another 30 per cent travelled through the Strait of Hormuz before the Iran war, according to the International Food Policy Research<\/a> Institute.<\/p>\n

Australia does not produce urea \u2013 the main ingredient in the most commonly used nitrogen fertiliser \u2013 and relies almost entirely on imports, prompting warnings of price hikes as far back as March<\/a>.<\/p>\n

While fertiliser is nice for a home gardener, it\u2019s essential for large-scale food producers to increase crop yields.<\/p>\n

\u201cHaving expensive fertiliser\u2019s bad because that really puts pressure on your bottom line as from a production point of view,\u201d Taylor said.\u00a0<\/p>\n

\u201cBut having no fertiliser is catastrophic because your yields will fall by at least 50 per cent and then it all snowballs from there.\u201d<\/p>\n

\"Australian<\/p>\n

Prime Minister Anthony Albanese at a fertiliser production plant in Brunei on April 15, 2026.\u00a0X\/@AlboMP<\/p>\n

He wants a return to local production \u2013 inexistent since Incitec Pivot closed its Brisbane<\/a> fertiliser plant in 2022 \u2013 to help assure Australia\u2019s food security.<\/p>\n

His thoughts on fuel are similar.\u00a0<\/p>\n

\u201cIf the ships stop coming for whatever reason, we haven\u2019t got much up our sleeves,\u201d he notes.<\/p>\n

Energy Minister Chris Bowen\u2019s weekly fuel supply announcements may not be the headline news they were at the start of the war but the margin for error remains relatively low.<\/p>\n

In his latest update, the country had 41 days of petrol, 33 days of diesel and 28 days of jet fuel, including 48 ships on the way to our shores.<\/p>\n

He said the government<\/a>\u2019s policy focus remained on \u201csteady engagement with trading partners\u201d in the Middle East and Asia<\/a>, and working with Australia\u2019s two remaining oil refineries to ensure they can produce fuel.<\/p>\n

\"\"<\/p>\n

It would be only the nation\u2019s third operating refinery, complementing operations in Geelong (pictured) and Brisbane.\u00a0Nicholas Walker<\/p>\n

\u201cAustralians can take some confidence in the fact that now, well over six months into this crisis, despite the predictions of shortfalls and rationing by some in politics<\/a>, and some people who said they\u2019re experts, we\u2019ve managed, in working with trading partners and with refineries, to see ongoing fuel supply in Australia,\u201d he said.<\/p>\n

Bowen said the government was also working on boosting the full reserve and moving towards low-carbon liquid fuels.<\/p>\n

While we wait for the nation\u2019s trucking fleet to electrify, Taylor wants to see more fuel refined in Australia to protect the country from global shocks.<\/p>\n

\u201cA fuel strategy is part of the food security strategy because if we run out of fuel \u2013\u00a0 like if we run out of diesel, if diesel becomes not only expensive but if we don’t have it \u2013 well, Australia literally stops,\u201d he said.<\/p>\n

\u201cLike everything runs on fuel. The trucks that run up and down the coast from the east coast, trucks going whichever way, delivering whatever. They all run on diesel.\u201d<\/p>\n

The importance of electrification<\/p>\n

Transport emissions were about 21 per cent of Australia\u2019s carbon emissions in 2022, according to the Climate Change Authority, with about a quarter of that coming from trucks and buses.<\/p>\n

Humanity is losing more ground in the fight against climate change and heading for a hotter world than experts projected last year, a new United Nations report released this week says.\u00a0<\/p>\n

If all countries do what they promise to reduce heat-trapping emissions, Earth will likely still warm another 1.2 degrees above current temperatures, it found, and US policy changes this year will likely add a tenth of a degree alone.<\/p>\n

Australian climate scientist Bill Hare said an extra one-tenth of a degree pushes an additional 140 million people \u201cinto dangerously hot conditions\u201d and increases the odds of the collapse of the Amazon rain<\/a> forest or ice sheets in Greenland and Antarctica.<\/p>\n

\u201c[The US is going] hell-for-leather trying to block renewables while actively promoting and subsidising dirty coal \u2014 and its diplomacy is trying to make other countries also pull back on action,\u201d he said,<\/p>\n

\u201cIt is looking at the fire<\/a>, denying there is a fire, and then pouring more petrol on it.\u201d<\/p>\n

– Reported with Associated Press<\/p>\n","protected":false},"excerpt":{"rendered":"It\u2019s harvest time in Queensland. That means wheat, barley and chick peas heading for shelves and feedlots, and…\n","protected":false},"author":2,"featured_media":939932,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[64,63,99],"class_list":["post-939931","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-au","tag-australia","tag-business"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/939931","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=939931"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/939931\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/939932"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=939931"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=939931"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=939931"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}