Australians are watching fuel prices and wondering how bad this could get. Donald Trump’s comments on Iran and the Strait of Hormuz on Tuesday delivered a blunt message: Don’t assume the United States will carry the burden of keeping global energy flowing.
That shift matters for Australia far more than the daily swings on the bowser price list.
In true Australian fashion, the early response has centred on who to blame.
Pointing fingers at the government of the day might feel satisfying, but it avoids the real problem.
Australia’s fuel vulnerability didn’t emerge overnight, and no single government created it. Decades of economic policy prioritised efficiency, low costs and just-in-time supply chains, and Australians reaped the economic benefits of these decisions.
That model assumed a stable world.
We now have war in both Europe and the Middle East, but in fact the world was insecure and unstable well before either conflict. We just didn’t act until military disruption happened.
The hope now is that our actions are better late than never.
The Strait of Hormuz carries roughly a fifth of the global oil supply. Any threat to the flow through it drives immediate volatility. Trump’s suggestion on Tuesday that the strait may not be a US problem adds a harder edge.
This may just be routine Trump rhetoric, but on face value we can no longer assume the US will step in to protect global energy flows. What is clear is that Australia can no longer outsource its energy security to another country’s political cycle.
Will the crisis continue? The immediate disruption may ease within weeks if tensions de-escalate. Volatility will not. Even if the issue is resolved quickly, its effects will be measured in months and years. Boardrooms will feel it. Households will, too.
Modern supply chains amplify the effect. Shipping costs spike, financing tightens, and fuel availability becomes uneven within days. That shows up quickly in higher transport costs, rising groceries prices and pressure on small businesses.
Australia feels this faster than most because it relies heavily on imported fuel and has limited domestic refining capacity.
Australians will get through the current disruption. We always do. The real test comes after the immediate pressure fades. Covid-19 exposed similar vulnerabilities across supply chains. Many of those lessons faded from memory as conditions improved. Forgetting again would be a strategic mistake.
Australia needs to treat fuel security as part of a broader system that connects economic growth, national security and infrastructure resilience. Markets remain essential, but they alone won’t consistently give us redundancy or surge capacity. The government must act as a system orchestrator.
Start with one priority: Expand regional fuel storage and secure the transport networks that keep supply moving beyond the capital cities. Support domestic refining where it makes strategic sense. Strengthen the financial resilience of the logistics sector so it can operate under stress, not just in good times.
While not a standalone solution, northern Australia offers a clear opportunity. The region already supports defence posture, resource exports and critical infrastructure, and it plays a growing role in national logistics. Targeted investment in northern storage, ports and transport corridors would strengthen system-wide resilience, particularly under stress.
That investment must sit within a broader national approach that connects supply, storage and distribution across the entire network to reduce vulnerability while driving productivity and growth.
Trump’s unpredictability will continue to shape global energy markets. Australia cannot control that.
Canberra also can’t control economic coercion and military aggression emanating from Beijing. But Canberra is not powerless either, and it can control how well the country prepares for disruption, whatever its source. Whether the current crisis lasts weeks or months matters less than whether leaders act on its lessons.
Australia cannot control Hormuz or when it reopens. It can control how prepared it is when it or another supply line inevitably closes again.
This article was originally published in the Daily Telegraph.
