Originally published by Adam Creighton of The Institute of Public Affairs
17.04.2026
The Australian
The spectacular fire at the Viva Energy refinery in Geelong is yet another reminder not only of our increasingly fragile fuel security but how pathetically we’ve been governed. A kakistocracy indeed. This is not some obscure facility. It supplies roughly half of Victoria’s petrol and about 10 per cent of the country’s.
The fire wasn’t a co-called black swan event – something that couldn’t have been envisaged – but very much a white one. Every year numerous refineries among the many hundreds around the world experience serious fires that can cripple production. Australia’s last two remaining refineries have practically been condemned to closure as the de facto carbon tax, known as the Safeguard Mechanism, steadily tightens its noose around their financial viability. Indeed, the Geelong refiner has been propped up by the federal government since 2021.
Both Labor and the Coalition bear heavy responsibility for our predicament, which some analysts expect will trigger economically damaging fuel rationing. Western Australia has already announced it will secure its own stocks, perhaps heralding the states will once again go it alone, Covid style.
Back in 2020, then opposition leader Anthony Albanese made some obvious points about our pathetically insufficient preparation for a fuel shortage, in a video that’s gone awkwardly viral online.
“We shouldn’t be dependent upon circumstances which may be beyond our control, such as any particular international incident, be it military conflict or other issues, will mean that we run out of fuel,” he said. “Disruption of sea lanes may well occur at some stage in the future, that is why nation-states need to have this fuel capacity,” he added, demanding the Morrison government “emerge with a plan for refining” and aim to achieve the global 90-day minimum for domestic onshore fuel stocks. The Coalition had had seven years to rectify a glaring oversight. Indeed, in 2014 I wrote how Australia was the only one of the 29 countries that ignored the 90-day emergency fuel stock convention recommended by the International Energy Agency.
“Iran, unpredictable, hobbled by sanctions and fundamentalism, repeatedly has threatened to thwart passage of oil tankers through the Strait (of Hormuz) to throttle global growth. Given its proximity and regional military superiority, it probably could,” I added.
Labor has had four years and similarly done nothing, with the Coalition presiding over the closure of six of eight refineries only 15 years ago. South Australia’s Stanvac refinery shut down in 2009, followed by Clyde in NSW, Kurnell in 2014, Bulwer Island in 2015, and Altona and Kwinana from 2020. We aren’t the only fools; the Ardern NZ government allowed the nation’s sole oil refinery at Marsden to close in 2022, yet at least it had the sense to keep more than 80 days’ fuel supply.
In a country as large and energy-rich as Australia, this shouldn’t have happened. Yes, Asian refineries are larger and more efficient, not least because of self-imposed emissions standards, but oil isn’t French Champagne or even the latest smartphones, which we could do without. Refined fuel is not just another tradeable good. It is a strategic input into almost every aspect of modern life. Transport, agriculture, mining, construction all depend on it. When supply is disrupted, the effects are immediate and economy-wide.
Australia imports 80-90 per cent of its refined fuel. That leaves us heavily exposed not only to global price movements, but supply disruptions. Wars, shipping bottlenecks, or geopolitical tensions can quickly translate into higher prices. The fuel crisis at least will highlight the farce of the so-called “transition” and the push for wind and solar power.
Australia still runs on diesel. Cars, trucks, planes and heavy machinery cannot be wished away. Even optimistic projections show petrol and diesel remaining essential well into the 2040s. Scores of billions of dollars have been committed to “net-zero” boondoggles, subsidies for renewables and electrification schemes on the naive belief the nation can be electrified. The result is an increasingly hollowed-out system: high reliance on imports and very limited ability to respond to shocks, especially the double whammy of war in the Middle East and an accident crippling 50 per cent of the nation’s refining capacity.
The system might look efficient on paper but is obviously brittle under pressure. Energy security has a cost. Maintaining domestic refining capacity may mean higher prices than importing from mega-refineries. But with better policies, that needn’t be the case long-term.
At least the crisis has shown the madness of prevailing energy policy and should hasten its demise. Strangling heavy industry with futile emissions reductions policies, then arbitrarily bailing out select producers for political reasons, is making the nation poorer, doing nothing for the environment and fundamentally smashing our energy security.
