Australia Faces Potential Fuel Shortages Amid China Export Pause

Australia Faces Jet Fuel Supply Risks as China Halts Fuel Exports Amid Middle East Uncertainty​

New Delhi, March 14: Australia’s exposure to liquid fuel shortages and potential price spikes has intensified after reports that China has instructed its oil refiners to halt fuel exports, raising concerns over jet fuel availability and possible disruptions to aviation operations.

A report by The Conversation said the development comes at a time when global energy markets remain unsettled due to the ongoing Iran conflict and its implications for oil supplies.

Chinese Export Halt Raises Immediate Supply Concerns​

According to the Australian Financial Review, Chinese authorities have asked domestic refiners to stop exporting fuel, casting uncertainty over at least two cargo shipments that were expected to reach Australia.

The move could significantly affect Australia’s aviation fuel supply chain, which depends heavily on imports from Asian refining hubs.

At the same time, reports of attacks on two transport ships in the Strait of Hormuz have heightened shipping risks in one of the world’s most important energy transit routes. The escalating tensions increase the possibility that vessels may avoid the route while the conflict persists, potentially tightening fuel flows to Asia and beyond.

Heavy Dependence on Imported Jet Fuel​

Asian refineries rely extensively on crude oil from the Middle East, with several countries in the region importing as much as 90 percent of their crude from the area.

Australia, a net importer of liquid fuels, is particularly reliant on fuel shipments from Asian refineries for aviation needs. In 2025, around 32 percent of Australia’s jet fuel imports came from China.

If Chinese exports remain suspended, Australia may need to secure alternative supplies from other regional producers including South Korea, Taiwan, Singapore, Malaysia, and India. However, these suppliers could also face constraints if Middle East crude shipments are disrupted.

Limited Jet Fuel Reserves Add to Vulnerability​

The report highlighted that Australia currently holds between 29 and 32 days of jet fuel reserves, amounting to roughly 802 million litres, based on figures from the Department of Industry, Science and Resources.

These reserves are stored either at domestic storage facilities or aboard ships located within Australia’s exclusive economic zone.

Despite these stocks, Australia remains below the 90 day emergency reserve requirement set for members of the International Energy Agency.

Aviation Sector May Face Cost Pressures​

Australia’s aviation fuel supply chain is built around continuous tanker deliveries rather than large-scale long-term storage. As a result, airport fuel availability could become strained within weeks if fresh shipments fail to arrive.

While no flight cancellations have been reported so far, Australia’s largest airline Qantas has warned that airfares may rise.

Airlines may also introduce fuel surcharges, reduce the number of flights, or ration fuel if supply pressures intensify.

Meanwhile, Air New Zealand has already reduced around 1,100 flights due to rising fuel costs and supply constraints, raising concerns that regional aviation networks could face further disruptions if the situation persists.