Last week, it emerged that Australia was just 43 days away from completely running out of fuel. That would mean people aren’t able to fill up cars, planes won’t be able to fly and many of the emergency services would be unable to do their jobs. There have been many warnings about an impending crisis as Australia’s dependence on fuel imports has grown, yet very little has been done to manage it.
Australia’s Fuel Shortfall
The International Energy Agency (IEA), of which Australia is a part of, requires countries to have a minimum of a 90-day reserve of fuel for cases like this. Given that Australia had only 43 days last week, they’re obviously well below that requirement and now in danger of not having enough despite having pledged to meet the 90-day reserve target in 2015.
There have been a number of warnings in recent years, yet the Australian Government has continued with ‘business as normal. ‘They operate on a ‘just in time’ approach that means, whilst they receive the required fuel to keep the country going, they rarely have enough in reserve should there be a breakdown in supply.
The consumption of fuel is fast outpacing the production of oil within Australia and so importing fuels from outside is the only way for the demand for fuel to be met. In 2016-17, Australia imported 54,853.4ML of fuel into the country and used 57,780.7ML. Australia still produced 27,353.4ML of fuel in the same period, but over the last 6 years that has dropped by more than 33% (Department of the Environment and Energy 2018).
Just last year, Australia’s fuel security was called into question by a number of defence experts. Tensions in the South China Sea, a route that much of Australian fuel imports take, were putting a risk on the supply Australia needed. Whilst no real crisis has yet arisen from that, conflict in Syria and the Middle East is putting an even greater strain on fuel supply, creating the crisis that is now occurring. Like many places around the world that are heavily reliant on oil from the Middle East, the recent conflicts in the region have strained the supply of oil to many import-dependent countries. 91% of Australia’s oil comes from the Middle East region before being shipped off to a number of countries in Asia and to Australia to be refined into fuels that are most commonly used for transport. This reliance on imports in unsustainable for Australia and could lead to economic and social disaster unless it is addressed and a more sustainable source can be used.
“The fundmental assumption they’ve made is because we haven’t had a problem in 30 years, we’re not going to have a problem.” – John Blackburn, retired Air Vice Marshall.
The demand for fuel is set to increase over the next few decades as the population of Australia continues to grow. As the population increases, so will the number of cars on the roads of Australia’s cities. If Australia is to sustain the projected population growth then it must find additional sources of fuel within its own country and/or develop alternatives and encourage the Australian population to purchase these cars.
Australia’s dependence on imported fuel should be much more of a worry to the Australian Government than it appears to be. This crisis is not a new one, it’s just worse than previous problems the country has faced in sourcing fuel. First, Australia must secure fuel supplies to stop the impending crisis that could bring Australia to a standstill before the end of May. Secondly, Australia must secure the reserves required by the IEA to ensure that a crisis like this doesn’t happen again. Finally, Australia should look to alternative fuels to keep the country moving. Fossil fuels aren’t a long-term solution to what will become a growing problem in Australia but alternative fuels are. In most cases, they are cleaner to produce and use and will reduce Australia’s fuel dependence. Let’s just hope they can find a way out of this crisis first.
April 24, 2018