In Queensland's Granite Belt, Robert Fenwick has become an unlikely fuel hunter. The wine producer normally orders diesel through his commercial supplier. That arrangement collapsed this week when the company told him they had nothing to deliver. His local petrol station had run out of unleaded. So Fenwick grabbed a jerry can, climbed into his ute, and drove from pump to pump across the countryside, scrounging 600 litres at enormous expense. Fuel prices had jumped 30 to 50 cents per litre in just days.
It is a scene repeating across rural and regional Australia. According to the National Farmers' Federation, farmers and fishers in regional communities are increasingly struggling to secure fuel, putting food security and animal welfare at risk. The crisis is not a simple shortage. It is a collapse in the distribution chain itself.
While overall national liquid fuel supplies may remain sound, impacts are being acutely felt in regional communities, especially among independent retailers who rely on the spot market for supplies, with concentrated impacts in regional communities where independent retailers dominate. In Dubbo, western NSW, Inland Petroleum's wholesale operator Nathan Laing discovered his Newcastle supplier had no diesel available on Thursday morning. He was forced to buy from another supplier charging 35 cents per litre more.
Small family service stations cannot get supply and are closing their pumps because fuel companies are supplying their chains to take the margin. Major retailers with long-term contracts are being prioritised; everyone else is left waiting. For farmers who depend on independent servos, the system is breaking down precisely when they need it most.
The timing could not be worse. Farmers are heading into planting and harvest windows where diesel use spikes, and ensuring fuel reaches farm businesses is essential to keeping food moving from paddocks to plates and ports. One wheat and barley farmer said her planting season is approaching but farmers are struggling to secure the supplies they need, with prices having increased so much that it is uneconomical to plant the crop.
The root cause sits thousands of kilometres away, in the Middle East. Global oil supply disruptions have tightened refined fuel markets worldwide. Across regional Australia this week, drivers reported local service stations were rationing petrol. As of early March, Australia has 36 days of petrol, 32 days of diesel, and 29 days of jet fuel in reserve. Australia is not running out of fuel, but the system designed to distribute it under normal conditions has begun to strain.
The government response has focused on reassurance rather than intervention. Energy Minister Chris Bowen has emphasised that national supplies are adequate. Bowen said he has great concern for farmers having difficulty getting diesel, but the situation reflects managing a huge spike in demand, not an impact on supply. Yet for a servo owner watching their pumps run dry, or a farmer unable to plant his paddock, abstract national figures offer cold comfort.
Farmers and fishers have told the National Farmers' Federation that fuel is becoming harder to access and prices are simply becoming unrealistic, and they need to see a clear plan from government as to how it will respond both now and into the future. The federation warned that food prices could rise by as much as 50 per cent.
There is a legitimate debate about the proper role of government in commodity markets. Price controls can distort supply further. Rationing creates its own inefficiencies. Yet the current market mechanism is clearly failing rural communities in a way it is not affecting urban ones. One independent wholesaler based at Dubbo in NSW was unable to get diesel at a major depot and had to go to another supplier charging 35 cents more, forcing them to charge more to agricultural customers, which would eventually push up food prices.
The deeper issue is structural. Australia manufactures little of its own refined fuel. Brisbane's Ampol refinery exports fuel due to its high sulphur content; it would be better for everyone if the refinery were upgraded to produce low sulphur fuels. We rely on continuous imports from Asia. When those imports stumble, regional communities feel the shock first and hardest.
Fenwick offered a blunt assessment of the panic around him. He called it more of a toilet paper crisis rather than a real fuel crisis. There may be truth in that. Yet even a panic is real when you cannot plant your crop, when your servo sits with dry pumps, or when a small family business cannot compete against the fuel chains. For regional Australia, this is a moment when the system is being tested, and so far it is failing the people who depend on it most.