Australia set to sign a deal with the United States to boost the country’s emergency fuel stockpiles
- Energy Minister will sign new deal in Washington securing access to US crude oil
- The United States has world’s largest reserves of crude oil and petroleum
- Minister said deal would boost Australia’s access to emergency fuel stocks
- The agreement has been criticised by Australian Trucking Association
The federal government will sign a new agreement with the US to boost Australia’s emergency fuel stockpiles after reserves got dangerously low in 2018.
Energy Minister Angus Taylor will sign a deal in Washington to secure access to America’s petrol and crude oil supply.
Australia has an international obligation to have 90 days worth of supply, but in August only had enough petrol and crude oil to last 28 days.
Energy Minister Angus Taylor is set to sign a deal in Washington which would secure Australia access to the United States’ crude oil reserves
Mr Taylor will also meet with oil industry heads in Texas before visiting a renewable energy technology centre in Colorado.
Car and truck drivers criticised the flagged deal with the US in August, saying any emergency supplies needed to be in Australia.
‘It would not provide security for the Australian economy if there is a disruption to international supply chains,’ Australian Trucking Association chair Geoff Crouch said last year.
‘The proposal to meet Australia’s fuel security obligations by tapping into the US reserve is, as a result, simply not viable.
‘Australia must have emergency stockholdings that meet our international obligations and they must be in Australia.’
At the time, Mr Taylor said emergency supplied would take up to 40 days to reach Australia from the US.
Australia has an international obligation to have 90 days worth of supply and the move to an agreement was looked at after 2018 reserves were down to just 18 consumption days of petrol
Mr Taylor (pictured) said it secure Australia’s access to crude oil but also demonstrate the country as ‘safe, reliable and stable’ for investment in gas, hydrogen and emerging energy
Mr Taylor also said on Sunday the government would be releasing a consultation paper for investment in renewable technologies in coming weeks.
The Australian Government’s interim fuel security report in 2019 found that at the end of 2018 Australia only had 18 consumption days of petrol in stock.
The report also found Australia’s fuel stocks were not available equally across the country and that there were significant regional variances.
The strategic petroleum reserve, underground in the United States, is known as the world’s largest emergency fuel supply with tens of millions of barrels.
In a 2019 interview with ABC News, Mr Taylor said tapping into the US fuel stock reserve would be cheaper than creating one in Australia.
‘The whole point of this is to minimise costs,’ he said.
‘What we don’t want to do is establish a physical reserve at very high cost in Australia and pass on that cost to Australians at the bowser.’
Australia has four major oil refineries, in Altona, Lytton, Geelong and Kwinana, but overseas crude oils can still be purchased at lower prices.
While Australia has four major oil refineries, in Altona, Lytton, Geelong and Kwinana but overseas crude oils can still be purchased at lower prices