The energy minister, Chris Bowen, says motorists should not panic-buy fuel amid the escalating conflict in the Middle East, with refiners assuring the federal government the country has secure supply to last through to May.
Australia currently has about 36 days of petrol supply in reserve, as well as 34 days of diesel and 32 days of jet fuel, well below international benchmarks.
Australia is the only International Energy Agency member consistently failing to meet requirements for 90 days of stocks to cover periods of emergency. The 90-day obligation allows the IEA to trigger a collective stock release in case of an emergency. In that scenario, the country would make a proportional share of its oil reserve available to the market.
Bowen’s comments come as the treasurer, Jim Chalmers, put retailers on notice on Tuesday, urging the Australian Competition and Consumer Commission to monitor for price gouging amid a jump in global oil prices. Long lines have been reported at some petrol stations in Australia’s biggest cities.
“There is no need to rush to the service station and fill up,” Bowen said.
“I do understand people’s concerns, but it’s important that people know we do have a good stock of petrol in reserve.
“There will be challenges in this difficult environment in the Middle East, the strait of Hormuz is a very important supply chain for the world. So there are real challenges, but there is no need for panic-buying, we just make the situation worse.”
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Pump prices have tracked higher over the past month, reflecting rising global oil prices as traders anticipated a US-Israel attack on Iran, which began at the weekend.
Oil prices have jumped another 10% so far this week, and are close to $US80 a barrel, based on the international Brent crude benchmark.
That means petrol prices are likely to track higher in Australia over the coming week as wholesale prices feed through to the bowser.
Chalmers asked the watchdog to “investigate any concerns arising about misrepresentations regarding petrol prices, false and misleading conduct or anti-competitive conduct in petrol markets, and to take appropriate action”.
“The recent spike … should not be used as an excuse for retailers to gouge customers or to increase prices opportunistically above and beyond the impact of events in the Middle East,” he said in a letter to the ACCC’s acting chair, Mick Keogh.
Iran’s Islamic Revolutionary Guard Corps has warned ships attempting to pass through the strait of Hormuz face attack. About 20% of the world’s crude oil supplies come through the strait, between Iran and Oman.
Bowen said he had spoken with the chief executives of Australia’s major refining companies on Tuesday, receiving assurances that contracts were in place to provide fuel through to May. The companies expect the contracts to be honoured.
“The biggest impact on petrol prices in Australia will always be oil prices, and oil price will come under pressure,” Bowen said.
“But for those Australians who are concerned about our supply of oil and petrol, I’m pleased to say that we are in good shape.”
