The Australian government has released two consultation papers that will help shape the next phase of Australia’s fuel security agenda.
This follows the announcement of the $14.8 billion Fuel Security and Resilience Package in the 2026-27 Budget.
Fuel security
The Strengthening Australia’s Fuel Security and Resilience Consultation Paper seeks feedback on key design features of three major measures that underpin the government’s approach to fuel security:
- Establishing the Australian Fuel Security Reserve.
- Increasing the Minimum Stockholding Obligation backed by co-investment in fuel storage.
- Supporting the continued operation of Australia’s two remaining domestic refineries beyond 2030.
The government is investing $3.2 billion to establish the Australian Fuel Security Reserve, creating a government-owned strategic reserve of one billion litres of diesel and jet fuel. The reserve will provide an additional safeguard against international supply disruptions and fuel market volatility, helping ensure Australians have access to the fuel they need when global markets come under pressure.
The government has also committed to increasing mandatory industry fuel stockholding requirements by an additional 10 days for diesel, petrol and jet fuel by 2030.
The consultation also seeks views on options to support Australia’s two remaining domestic refineries to continue operating beyond 2030.
Low carbon liquid fuels
The Securing Australia’s Cleaner Fuels Industry Consultation Paper seeks feedback on options to grow Australia’s domestic low carbon liquid fuels industry and reduce reliance on imported fuels.
The consultation is seeking views on a potential demand mechanism, including the level of ambition and how it could be implemented, impacts for businesses and consumers and the evidence required to inform key policy decisions.
“A stronger domestic low carbon liquid fuels industry represents a significant opportunity for Australia to diversify supply and produce more of the fuels we need here at home, creating jobs, attracting investment and strengthening regional economies,” says the government.
“It will also play an important role in reducing emissions in sectors where electrification is difficult, including aviation, heavy transport, mining and agriculture, supporting Australia’s transition to net zero while maintaining economic competitiveness.”
Securing Australia’s fuel future
Together, these measures will help secure Australia’s fuel future by ensuring reliable supplies, supporting domestic industry and building the cleaner fuels needed to drive future growth, according to the government.
Australian Minister for Climate Change and Energy Chris Bowen says Australia can’t afford to be vulnerable to fuel supply disruptions beyond its shores.
“That’s why we’re making a historic investment to strengthen fuel security, support domestic refining and build the cleaner fuels industries of the future,” he says.
“We’re strengthening Australia’s resilience by building larger fuel reserves, increasing stockholdings and backing domestic industry to produce more of the fuels we need here at home.
“By strengthening fuel security today and building cleaner fuel industries for tomorrow, we’re delivering practical economic and environmental benefits for Australian households, businesses and communities.”
The consultation papers are available on the Department of Climate Change, Energy, the Environment and Water’s Have Your Say platform here and here.
