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MUA Says Fuel Security Levy Worthy Of Consideration

November 27, 2017 10:28 AM

The Maritime Union of Australia (MUA) is again calling on the Turnbull Government to look at ways to increase our nation’s fuel security after news reports today said that tensions in the South China Sea and North Korea could result in severe fuel shortages in Australia.

Australia is the only member of the International Energy Agency (IEA) that does not meet the requirement of 90 days of liquid fuel supplies. Parliament has passed a bill to make Australia complaint by 2026 but this relies in part on other countries to release oil on our behalf.

Following on from yesterday’s release of the 2017 Foreign Policy White Paper, Liberal Backbencher Andrew Hastie today told Sky News he is very concerned about the issue and is open-minded to any suggestions, such as a fuel levy.

Such dire warnings are not new, with former Liberal senator Bill Heffernan warning in December 2015 that Australia's security was being put at risk because of dwindling fuel supplies and urged the Government to address the problem.

MUA National Secretary Paddy Crumlin said the Turnbull Government had allowed refineries to close and the number of Australian-crewed fuel tankers to decline to zero under its watch.

“There are now no Australian-crewed tankers supplying fuel to our nation, down from 12 in the year 2000. At the same time, the number of refineries has halved to four. This means we now import more than 90 per cent of our fuel and that number is rising,” Crumlin said.

“A Senate inquiry into fuel security in 2015 heard that Australia's total stockholding of oil and liquid fuel comprises of two weeks of stocks at sea, 5 to 12 days of supply at refineries, 10 days of refined stock at terminals and 3 days of stocks at service stations.

“A substantial disruption in fuel supply would have serious consequences across the Australian community when it comes to delivery of food, medicine and running family cars on our roads.

“Australians would expect our Government to have a better plan and this would involve more refining here and Australian-crewed ships to carry it around the coast.

“Placing a fuel levy of one or two cents per litre to ensure fuel security and supply in the event of any global catastrophe seems like a small price to pay for peace of mind.

“This isn’t only a matter for fuel security but also national security. Unlike Australian seafarers, foreign crews have no background checks yet they are carrying petroleum products, ammonium nitrate and LNG around the Australian coast.”

The Department of Environment and Energy says on its website that: “Australia is a signatory to the International Energy Agency’s (IEA) International Energy Program (IEP) Treaty and participates in IEA oil market and energy emergency committees.

“A key requirement under the Treaty is that member countries hold oil stocks equivalent to at least 90 days of their prior year’s daily net oil imports, and in the event of a major oil disruption, contribute to IEA collective actions by way of a stock release, demand restraint, fuel switching, or increased production or fuel sharing.

“Australia has historically relied on commercial stock levels to meet the 90 day requirement. However, due to declining domestic production and increased demand for liquid fuels, these stocks are no longer sufficient to meet the 90 day requirement. Consequently, Australia has been structurally non-compliant with the 90 day stockholding obligation since March 2012.”

Media Contact: Darrin Barnett 0428 119 703