Victoria's government has moved swiftly to tackle servo price gouging as fuel markets convulse from escalating Middle East conflict. As of Tuesday 10 March, new anti-price gouging laws require every petrol station across the state to set a daily fuel price cap and publish it in advance.
Under the scheme, retailers have until 2pm to set their fuel price for the following day. The capped price is published on Servo Saver at 4pm and applies for 24 hours from 6am the following day. Retailers can reduce the price during a 24-hour period, but they cannot increase it. Breaching the rules carries penalties: petrol stations that fail to register or report their prices face fines of more than $3,000 for each breach, or more than $24,000 if taken to court.
Since launching last October, more than 265,000 Victorians have used the Servo Saver app, estimated to save motorists up to $333 a year at the pump. The daily price cap represents phase two of the government's Fair Fuel Plan, designed to give drivers visibility of tomorrow's prices so they can avoid the mid-day price spikes that have frustrated motorists for years.
Yet Victoria's regulatory response, however sensible, cannot address the underlying crisis now unfolding across rural Australia. Beyond the city limits, the fuel picture is far grimmer. Robert Fenwick, owner of Heritage Estate Wines in Queensland's Granite Belt, spent recent days driving around countryside trying to find diesel after his regular commercial fuel supplier said they had nothing to deliver. Fenwick picked up 600 litres of fuel at enormous expense, with prices rising 30 to 50 cents in days.
The disruption is widespread. Goondiwindi Mayor Lawrence Springborg reported that independent petrol stations near the Queensland and New South Wales border had run out of petrol, with two service stations in Goondiwindi also running dry. Service stations in regional Western Australian towns of Kulin and Corrigin have placed temporary restrictions on fuel due to uncertain deliveries and panic buying. Regional retailers face rationing while consumer panic buying empties bowsers faster than supply lines can refill them.
Queensland-based distributor Bartranz Petroleum reported it was allocated just 10 per cent of its usual daily liftings from Brisbane due to hoarders depleting stocks at retail locations. The shortage is not primarily a supply problem. Energy Minister Chris Bowen told Parliament that difficulties experienced by farmers are not currently the result of a lack of fuel coming to the country, with supplies arriving as expected. He attributed the shortages to panic buying, with service stations ordering 100 to 200 per cent of normal volumes.
For agriculture, the timing could hardly be worse. Farmers face a real prospect of struggling to run their businesses, particularly as the autumn planting season approaches. Without reliable diesel supply, tractors stop, irrigation stops, harvest stops and food stops moving. Yet NSW government has admitted it has done absolutely no modelling and has no plan to ensure farmers can access fuel during a supply disruption.
The crisis exposes a structural weakness in Australia's energy policy that Victoria's price cap cannot fix. Australia has just over a month of diesel and petrol supplies available if imports were disrupted, with Energy Minister Chris Bowen confirming the country has 34 days of diesel, 32 days of jet fuel and 36 days of petrol available. Australia has been non-compliant with the International Energy Agency requirement to hold 90 days of net fuel imports since 2012. This vulnerability remains despite government assurances that strategic reserves exist overseas.
The question facing policymakers is whether transparency and price controls on retail fuel are sufficient responses when the underlying issue is consumer confidence and supply chain resilience. Victoria's measure is sensible: giving motorists certainty about tomorrow's prices should dampen panic buying and create competitive pressure on retailers. But it addresses a symptom of the crisis, not its cause.
Farmers are calling for prioritised access to fuel supplies if formal rationing becomes necessary, a position difficult to argue against when food production depends on diesel but recreational fuel consumption does not. What remains unclear is whether the federal government has adequate contingency plans should the Middle East conflict further disrupt global oil supplies, or whether Australia's fuel security will remain hostage to geopolitical events beyond our control.