Energy Security & Electric Vehicles

There are four major reasons why the Australian government (of any political persuasion) should be encouraging the uptake of an Electrified fleet – energy security, economic well being, health and environment considerations.

The most important of these reasons from a strategic standpoint is Energy Security. Today Australia relies on foreign liquid fuel imports for 85% of its needs (and climbing). Australia’s refining capacity is also dwindling and it is estimated that by 2030 there will simply be no refining capacity in Australia at all.

Achilles Heel

Despite having huge natural reserves of energy and virtually limitless sunshine, the domestic transport fleet (including of course the armed forces) rely almost exclusively on imported liquid fuels. This reliance puts Australia in a critically vulnerable position if imported supplies are disrupted for any reason.

If the supply of liquid fuels is disrupted for even a short period Australia would grind to a halt within days. That is the finding of the report commissioned by the NRMA and carried out by Air Vice-Marshall John Blackburn (retired) titled “Australia’s Liquid Fuel Security”.

The report calls on the Australian government to take precautionary measures to deal with the disruption of the flow of oil to Australia. The report reveals a frightening scenario if the supply is disrupted through war, natural disaster or economic turmoil.

  • Dry goods could run out within nine days;

  • Chilled and frozen goods could run out within seven days;

  • Retail pharmacy supplies could run out within seven days;

  • Hospital pharmacy supplies could run out within three days; and

  • Fuel available to the public could run out within three days.

The following graphic, courtesy of the NRMA report, highlights the risk:

Fuel-Security-Infographic

Click to Enlarge

Back in 2018 the Turnbull Coalition Government received fierce criticism from one of its own, Liberal Senator Jim Molan, labeling liquid energy security “a single point of failure for Australia”. He warned that not only would a chronic oil shortage devastate Australia’s economy, but it would also immobilise the military.

With such high risk to Australia’s well being, it is imperative plans are put in place to lessen our dependency on liquid fuels or reduce it to minimal levels. Part of that planning should be to invest in an electrified fleet that can be powered by locally generated renewable energy.

The 2026 Iran Conflict: Blackburn’s Warning Realised

The US-Israel strikes on Iran on 28 February 2026, and the subsequent effective closure of the Strait of Hormuz, have tragically confirmed the scenario outlined by Blackburn . The Strait is a conduit for about one-fifth of the world’s maritime oil and oil products, and its disruption has sent shockwaves through global energy markets .

Australia’s Exposure

Australia is particularly vulnerable because it imports 80-90% of its refined fuel supply . The nation now has only two operating oil refineries (Ampol’s Lytton in Brisbane and Viva Energy’s Geelong), down from eight in 2000. These two refineries together supply only about 20% of Australia’s fuel needs .

As highlighted by Ampol chief executive Matthew Halliday, the crisis has “highlighted the criticality and the strategic nature of refining in Australia” .

Government Response to the Crisis

In response to the crisis, the Federal Government has taken several significant actions:

1. National Fuel Security Plan — In March 2026, the government unveiled a four-level National Fuel Security Plan to manage the crisis .

2. Fuel Stockpile Increases — As of May 2026, the government reported:

  • 43 days of petrol on hand (5 days more than when the crisis began) .

  • 38 days of diesel (the highest holding since the minimum stock obligation began in 2023) .

  • 3.4 billion litres of fuel locked in for delivery over four weeks .

**3. $10 Billion Fuel Security Package** — The government unveiled a $10 billion package to increase fuel and fertiliser security, including a reserve of about a billion litres and a lift of the minimum stockholding obligation for every type of fuel .

4. International Diplomacy — The government has engaged with key partners, including South Korea, Singapore, Malaysia, and China, to secure fuel supplies. Australia is now importing jet fuel from China for the first time . Australia’s relative wealth and codependence on LNG exports have helped it remain a priority for Asian refiners .

5. Support for EV Transition — The government extended the Electric Car Discount FBT exemption in the 2026-27 Federal Budget . However, this is being phased down from April 2027. Professor Hussein Dia from Swinburne University noted that “transport policy is increasingly becoming energy policy… Electrification is now being viewed not only through an environmental lens, but also through economic resilience and national security lenses” .

The Ongoing Threat: A Fragile Recovery

While fuel supplies have proven more resilient than initially feared, the situation remains fragile. S&P Global Ratings has warned that if trading partners turn inward, Australia “could need to impose rationing within weeks” . Even if the strait were to reopen fully, oil and gas supply would normalize only gradually over several months .

Ampol’s CEO noted that “once the Iranians have demonstrated what they’re able to do, it’s very hard to permanently remove that again,” highlighting the long-term shift in power dynamics in the region .

With such high risk to Australia’s well being, it is imperative plans are put in place to lessen our dependency on liquid fuels or reduce it to minimal levels. Part of that planning should be to invest in an electrified fleet that can be powered by locally generated renewable energy.

For the full report click the following links:

Click for Blackburn’s Australia’s Liquid Fuel Security Part 1
Click for Blackburn’s Australia’s Liquid Fuel Security Part 2