Anthony Albanese braces for economic consequences from protracted Strait of Hormuz blockade
In short:
Prime Minister Anthony Albanese says around 50 tankers are en route to Australia to bolster fuel supplies as the turmoil from the war in Iran continues.
He has spent the past week securing extra fuel and fertiliser supplies to shield Australia from the crisis stemming from the Strait of Hormuz blockade.
What's next?
Mr Albanese said the government was preparing for the prospect of a protracted crisis.
The prime minister has flown home early from Malaysia to inspect damage from a fire at a Geelong oil refinery, returning with a range of new deals that secure extra fuel and fertiliser supplies.
The significance of Anthony Albanese's visits to Singapore, Brunei and Malaysia over the past week to secure extra supplies has been reinforced by Thursday's fire at Geelong, south-west of Melbourne.
Mr Albanese yesterday announced extra purchases of 100 million litres of diesel from Brunei and South Korea, on top of extra fertiliser purchases and an expansion of the halal meat trade with Malaysia.
In an interview with the ABC, he foreshadowed further arrangements in the coming days as a result of discussions with Indonesia.
"No government can say that they can fully protect their country from the impact that this is having right around the world," Mr Albanese told the ABC.
"What we can promise to do is to make every effort, both domestically and internationally, to shield Australians from the worst impact of this global crisis."
Tankers en route to Australia
The prime minister said that the export finance guarantee put in place by the federal government — which underwrites fuel purchases in the spot market — has significantly improved Australia's access to that global market and that, despite the crisis, there were around 50 tankers en route to Australia, even though the Strait of Hormuz has now been blockaded for almost two months.
"This is off the spot market, and by underwriting that supply, we're able to encourage the private sector to engage with the confidence that that underwriting from government brings," he said.
The guarantee also seems to have boosted the flow of shipments from many non-traditional suppliers.
But just where all the fuel is coming from when everyone is scrambling for it remains a mystery.
The ABC understands that ships are on their way from as far afield as the United States and Africa.
Countries rushing to bolster fuel supplies
All countries are rushing to boost their supplies, and it is causing tensions around the world.
For example, Malaysia and Singapore were exchanging insults this week over Malaysia's decision to negotiate with Iran to get a supposedly toll-free shipment of oil through the Strait.
Singapore insists countries should not negotiate with Iran.
Anthony Albanese's visit to Malaysia follows similar trips to Singapore and Brunei. (AAP: Bianca De Marchi)
Asked whether he would ever consider buying oil from Russia or Iran, countries that have been subject to heavy sanctions, the prime minister said: "Our sanctions remain in place."
"We have sourced the fuel from Brunei and Korea, and that will make a difference," Mr Albanese told the ABC.
"In addition to that, we've done work with Singapore, with Brunei and Malaysia, but we're also talking with South Korea. I've spoken with the Chinese premier. We're speaking to Japan.
Anthony Albanese reached an energy and food security agrement with the Sultan of Brunei before visiting Malaysia. (AAP: Bianca De Marchi)
"We're engaged in our region, and as well, we're engaged with Indonesia. I had contact with Indonesia today about further issues that might be advanced in the coming days.
"So we're working right across the board, whether it's diesel and other forms of fuel, whether it be fertiliser, the products that we need in Australia, we're working with our friends, and achieving results and outcomes, as a result of the investment that we've put in over the last four years, building those relationships. "
Fears for Australian economy amid turmoil
The prime minister and the government more broadly have made clear they are deeply worried about what lies ahead for the Australian economy — and the global economy — if this crisis continues to roll on without resolution.
"This conflict is having a devastating impact on the global economy, and Australia isn't immune from that," he said.
"This is a turbulent period in which there have been many moving parts.
"In the morning, we wake up and find out that statements or declarations have been made overseas that have an impact here.
"Now, Australia is not a party to this conflict, but we're impacted by it, just as our region is.
"We speak about the Strait of Hormuz, cutting out about 20 per cent of the global fuel supply. But importantly, the impact on Asia and on our region is much higher than that because it is this region that most of that fuel was headed towards."
PM diplomatic in responding to Trump
Asia was also the region hit hardest last year by Mr Trump's "Liberation Day" tariffs.
The prime minister has recently visited the region to seek fuel supplies, largely as a result of US President Donald Trump's actions.
He has also witnessed firsthand the pain inflicted on regional economies by the president's actions.
Asked whether the time had come for world leaders to more directly call out Mr Trump's erratic behaviour, given the catastrophic ramifications it's having around the globe, Mr Albanese offered a diplomatic response.
"Well, we have an important relationship with the United States," he said.
"I act respectfully towards all leaders, and I continue to engage constructively with President Trump and his administration. And I do so in Australia's national interest."
Loading...