Australian Prime Minister Anthony Albanese said on Monday the government would halve the excise on fuel and diesel and remove the heavy road user charge for three months to help households cope with a surge in costs driven by the Iran war.
Halving the tax would reduce the cost of fuel by 26.3 Australian cents per litre, Albanese said.
The total cost to the government would be about A$2.55 billion ($1.75 billion), Treasurer Jim Chalmers said at a joint press conference with the prime minister and Energy Minister Chris Bowen.
Some 20% of the world's oil was transported through the Strait of Hormuz before the U.S.-Israel war against Iran choked off supplies. The price of Brent has surged 59% in March, the steepest monthly gain in history, and was at $115.66 per barrel when the market opened on Monday.
The measures are the latest in a series of fuel security measures adopted by Canberra since the war began on 28 February. It has previously announced the release of petrol and diesel from domestic reserves and the temporary relaxation of fuel quality standards.
The average retail price of a litre of diesel rose to more than A$3 in Australia last week and petrol to A$2.50, according to a 29 March report from the Australian Petroleum Institute.
"We understand the cost pressures for people are very real as the impact of the war on the other side of the world plays out right here," Albanese told the press conference in Canberra.
The government also confirmed it had adopted a national fuel security plan with all state governments agreeing to work together to deliver fuel to regional areas where it is needed most.
Albanese said there were four levels of action and Australia was at level two, which was to keep the country moving. The highest level would be to ensure critical services were maintained.
“While Australia's fuel supply outlook remains secure in the near term, we need to be very clear as well with Australians that the longer this war goes on, the worse the impacts will be,” Albanese said.
Australia has its highest fuel stocks in 15 years, but they are still far belowInternational Energy Agency recommendations of 90 days.
The latest government numbers as of last week said Australia had enough for 30 days of diesel, 30 days of jet fuel and 39 days of petrol.
It has also adopted the Export Finance and Insurance Corporation Amendment which will allow the government to underwrite the purchase of spot cargoes of fuel as prices rise via credit agency Export Finance Australia.
Bowen said that spot cargoes were available but expensive and smaller industry players were not able to take the risk.
“These new fuel security powers will put Australia in a strong position, securing fuel supply where it may be cost prohibitive for private suppliers to source on commercial terms, without government support,” Bowen said in a statement.
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India has purchased crude oil from Iran for the first time in seven years, as supply disruptions in the Middle East threaten global energy markets.
British police have arrested a fourth person in connection with an arson attack on ambulances belonging to a Jewish community charity. The arrest took place at a London court on Saturday, where three other suspects were already appearing.
Senegal has taken steps to curb government spending by banning non-essential foreign travel for ministers, as rising global oil prices place increasing pressure on the country’s finances.
One U.S. crew member has been rescued after two American warplanes were downed over Iran and the Gulf, as the search continues for a missing pilot, while President Donald Trump has given Tehran 48 hours to agree to a deal to end the war.
The U.N. Security Council is expected to vote next week on a Bahraini resolution to reopen the Strait of Hormuz and protect commercial shipping, diplomats said on Friday, amid opposition from China to any authorisation of force.
One crew member from a U.S. warplane shot down over Iran has been rescued, U.S. officials said, as a search continues for a second crew member.
Iran has strongly condemned U.S. President Donald Trump’s threat to bomb the country “back to the Stone Age”, calling his remarks an example of “war crimes and genocide.”
France and South Korea have agreed to strengthen defence ties and energy security cooperation following a two-day visit by French President Emmanuel Macron to Seoul.
The U.N. Security Council is expected to vote next week on a Bahraini resolution to reopen the Strait of Hormuz and protect commercial shipping, diplomats said on Friday, amid opposition from China to any authorisation of force.
One U.S. crew member has been rescued after two American warplanes were downed over Iran and the Gulf, as the search continues for a missing pilot, while President Donald Trump has given Tehran 48 hours to agree to a deal to end the war.
Iran has strongly condemned U.S. President Donald Trump’s threat to bomb the country “back to the Stone Age”, calling his remarks an example of “war crimes and genocide.”
International law experts from across the U.S., including Harvard, Yale and Stanford, have signed an open letter saying the strikes on Iran may amount to war crimes. America and Israel began airstrikes on 28 February on Iran's capital, Tehran.
The global commodities market is facing a severe structural supply shock after a series of coordinated military strikes in the Middle East devastated critical industrial infrastructure, threatening the manufacturing base of Western economies.
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