Australia’s Resource Security Dilemma’

AVM John Blackburn AO (Retd)

As the world’s ninth-largest energy producer, Australia has abundant renewable and non- renewable energy resources. Despite these resources, we are heavily dependent on imports of refined petroleum products and crude oil to meet our liquid fuel demand. This import dependency has increased in recent years.  Our transport systems are wholly oil dependent. The reasons for this dependency may be economically sound due to the relative lower cost of oil but the lack of fuel diversity significantly impacts our resilience if we experience supply interruptions or a reducing availability of affordable oil supplies in the future.
The very small consumption stockholdings of oil and liquid fuels in Australia, combined with what appears to be a narrow assessment of our fuel supply chain vulnerabilities, does not provide much confidence that the strategic risks to our fuel supply chain are well understood and mitigated by our nation’s leaders, the business community or the population at large.
In essence, we have adopted a “she’ll be   right” approach to fuel security, relying on the historical performance of global oil and fuel markets to provide in all cases. Unfortunately, as a result of our limited and decreasing refining capacity, small stockholdings and long supply chains, our society is at significant risk if any of the assumptions contained in the vulnerability assessments made to date prove false.
We would not be the first country to get our assumptions wrong. In that respect, history can be relied upon.