A major fire at Viva Energy's Geelong refinery, which supplies half of Victoria's fuel and 10% of Australia's, has raised concerns about petrol price spikes and potential supply disruptions. The refinery has reduced output to minimum rates and entered a trading halt on the ASX.
Energy Minister Chris Bowen warned the fire could impact domestic petrol production 'for some time,' though diesel and jet fuel production continue. Energy analysts say Victorians can expect an immediate price shock, with national implications possible.
Kevin Morrison of the Institute for Energy Economics and Financial Analysis described the event as 'almost like a mini Strait of Hormuz closure,' noting the abrupt disruption to supply. Grattan Institute's Alison Reeve said a short-term price shock in Victoria is likely, but petrol is more replaceable than diesel or aviation fuel.
The fire comes amid global fuel pressures from the US-Israel conflict with Iran. The Australian government has already cut fuel excise, released reserves, and established a four-level fuel security plan, currently at level two, encouraging public transport use.
Analyst Saul Kavonic warned the fire will hamper government efforts to maintain supply as a global fuel shortage intensifies, potentially requiring stronger demand management. Victorian Premier Jacinta Allan stated current supply is sufficient, but any changes would not be contained by state borders.
