Panic buying begins in Kashmir, India due to fear of fuel shortage (Image: Getty)
Motorists’ access to fuel has been limited in some major Australian cities as concerns grow over the impact of the Middle East conflict on oil markets.
Energy Minister Chris Bowen confirmed on Thursday that 608 petrol stations were suffering from a shortage of at least one type of fuel, which is eight per cent of all fuel stations in the country.
Independent petrol stations in regional Australian towns have been struggling with fuel supplies for several weeks. At a Shell-branded Viva station on Sydney’s northern beaches, customers were limited to 50 liters of water per vehicle and jerry cans and external tanks were banned due to the shortage, The Australian reported.
The average price of 91 unleaded has increased to Rs 256.1ca litre, while diesel stands at 312.1ca litre.
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Mr Bowen said the fuel supply problems were being caused by a sudden increase in panic, The Mail reports.
“We have as much fuel in Australia today as we had on the day of the Iran attack. We have real issues, particularly in regional Australia, getting fuel to where demand is so high,” he said.
“We’ve seen a huge increase in demand. Some of it is panic buying. Some people are trying to get ahead of expected price increases. Some farmers are stocking up, which makes sense.”
“But the fact is, if demand suddenly increases dramatically, whether it’s for gasoline, diesel or even toilet paper, the supply chain comes under pressure.”
The minister said the country has received all expected fuel shipments so far, but six deliveries scheduled for April have been cancelled. Some have been replaced by alternative sources as tensions continue in the Strait of Hormuz, through which about a fifth of global oil trade passes.
Mr Bowen said 74 of the 80 fuel shipments expected during April and May were still on track to arrive.
Fear of fuel shortage triggers panic buying in Kashmir, India (Image: Getty)
The ongoing conflict in the Middle East has roiled oil markets since it began a month ago. The blockade in the Strait of Hormuz, targeting of energy infrastructure and comments from leaders in the conflict have unsettled investors and hit supply disruptions.
Australia imports about 90 percent of its refined fuel from overseas. Sappi primarily comes from Asia, but those countries get most of their crude oil from the Middle East.
Mr Bowen said contingency plans were in place to manage supply risks if the conflict continued for several weeks, but rationing was unlikely.
“We have also said that there are international supply risks ahead, but we are quite well placed to deal with those risks. There are a range of actions available to the government. Rationing would be a worst-case planning measure. That is not on the agenda,” he said.
He has also rejected the controversial $40 fuel purchase limit. The limit was outlined in the 2019 national emergency fuel shortage response, which has resurfaced in recent days.
He said, “To implement something like that, you would have to declare a national fuel emergency, which has never been done. I’ve already said I don’t envisage doing that. So it’s not really on the agenda.”
