Australia will allocate more than A$10 billion ($7.2 billion) from the Federal Budget to establish a permanent government-owned fuel security reserve of around 1 billion liters, Prime Minister Anthony Albanese said on Wednesday.
The Australian Fuel Security and Resilience package will boost the minimum stockholding obligation for every type of fuel by around 10 days. It will also strengthen the country's onshore reserves to ensure at least 50 days of fuel supply and storage, with a particular focus on diesel and aviation fuel.
As part of the package, A$7.5 billion will fund the establishment of a fuel and fertilizer security facility to increase the supply and storage of fuel and fertilizer. A further A$3.2 billion will be dedicated to a fuel security reserve to increase long-term diesel and aviation fuel supply and storage, to support the extended minimum stockholding obligations.
The country has been seeing high demand for diesel even as fuel supply has been disrupted since the start of the U.S.-Iran conflict on Feb. 28. Some service stations were running out of diesel and unleaded gasoline, said Chris Bowen, Minister for Climate Change and Energy in April.
Australia will also set aside A$10 million to support feasibility studies into new or expanded fuel-refining capabilities, Albanese said.
The 120,000 b/d Geelong refinery and the 109,00 b/d Lytton refinery are the only two operating in the country.
This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.
--Reporting by Thomas Cho, tcho@opisnet.com; Editing by Mei-Hwen Wong, mwong@opisnet.com
(END) Dow Jones Newswires
05-06-26 0150ET
