Australia Amends Export-Finance Laws to Enhance Fuel Security Amid Iran Conflict

In response to escalating fuel supply challenges linked to the ongoing conflict in Iran, Australia is set to amend its export-finance laws. Prime Minister Anthony Albanese announced these changes on March 28, 2026, aimed at bolstering the nation's fuel security as the country grapples with local shortages and rising prices. Australia, which imports approximately 90% of its fuel, has faced disruptions since the U.S. and Israel initiated military operations against Iran on February 28, 2026, impacting global fuel supply chains.

The Straits TimesUsNews and World ReportLabor Uses Fuel Security Powers to Boost Australia's Supply

The amendments will empower Australia's export-finance agency to underwrite private sector purchases of additional fuel shipments. This initiative is designed to mitigate financial risks for suppliers, encouraging them to secure discretionary cargoes during periods of uncertainty. Albanese emphasized that this measure is not a subsidy but a government guarantee that aims to stabilize supply and enhance confidence among fuel suppliers. As of late March 2026, Australia holds about 36 days of petrol, 32 days of diesel, and 29 days of jet fuel, according to Energy Minister Chris Bowen.

Labor Uses Fuel Security Powers to Boost Australia's SupplyUsNews and World ReportThe Straits Times

The conflict has led to significant increases in fuel prices across Australia. As of late March, average diesel prices in major cities reached 303.5 cents per litre, while unleaded petrol averaged 252.2 cents per litre. Regional areas have experienced even higher prices, with diesel averaging 307.6 cents per litre. These surges in fuel costs are expected to contribute to inflation, with economists forecasting a potential rise to 5.5% year-on-year by mid-2026. The Housing Industry Association has warned that sustained price increases could add between $8,000 and $15,000 to the cost of new home construction.

Labor Uses Fuel Security Powers to Boost Australia's Supply

The Coalition, led by Opposition spokesperson Angus Taylor, has criticized the government's approach, advocating for a reduction in the fuel excise and heavy vehicle road user charge to provide immediate relief to consumers. This proposal, however, could significantly reduce federal revenue at a time when the budget is already strained by emergency expenditures.

Labor Uses Fuel Security Powers to Boost Australia's Supply

The current fuel crisis has highlighted Australia's long-standing vulnerability due to its heavy reliance on imported fuel. The Maritime Union of Australia has called for urgent national action, including the rebuilding of Australia’s strategic tanker fleet and restoration of domestic fuel production capabilities. The government’s new fuel security powers are seen as a temporary measure while broader structural reforms are debated.

Labor Uses Fuel Security Powers to Boost Australia's Supply

The Albanese government plans to introduce the necessary amendments to parliament on March 30, 2026. The urgency of these changes is underscored by the potential for further disruptions in the Middle East, which could exacerbate the current supply challenges. As the situation evolves, monitoring fuel prices and the effectiveness of the new measures will be critical for assessing Australia's fuel security moving forward.

Labor Uses Fuel Security Powers to Boost Australia's Supply

• “New fuel security powers will enable the government to underwrite the purchase of fuel by the private sector.” — Anthony Albanese, Prime Minister

The Straits Times

• “A country that cannot transport its own fuel cannot guarantee its economic stability, its emergency response capability or its defence readiness,” — Jamie Newlyn, Maritime Union of Australia Assistant National Secretary

Labor Uses Fuel Security Powers to Boost Australia's Supply