Businesses are bracing for the fuel crisis to get worse over the next month, as the ongoing war in the Middle East means governments are still planning for a worst-case scenario.
In a business sentiment survey done by the Australian Bureau of Statistics, 72 per cent of businesses said fuel prices or availability was having a negative impact on them and more than one third had a drop in revenue over the last month.
A further 27 per cent said they expected their revenue to decrease in the next four weeks.
Wholesale trade, retail trade and hospitality businesses were the most pessimistic, with more than a third of accommodation and food outfits worried.
EY chief economist Cherelle Murphy said that given ongoing uncertainty, it was expected many businesses would be seeking to protect margins and maintain continuity as fuel and supply disruptions intensified.
The release of the survey, done earlier this month, came as the United States defensively struck Iranian boats and missile launch sites, casting further doubt on any deal with Tehran to end the war and reopen the Strait of Hormuz.
Australia has fuel supplies secured until July, but the government quietly acknowledges there is increased uncertainty beyond that and has yet to decide whether to extend the temporary fuel excise cut past July 1.
Energy Minister Chris Bowen could not say if Australia could avoid triggering the next phase of the fuel plan while the Strait of Hormuz was closed.
“I am going to say we are very well placed, about as well placed as any country in the world now,” he said.
“I don’t envisage needing rationing. That’s not the plan we’re working on.
“Governments, federal and state, are working together, have been (since the war began) on worst-case scenario contingency prudent planning should things get worse internationally, because there is pressure.”
Institute for Energy Economics and Financial Analysts energy finance analyst Kevin Morrison said things would get tight in the next few weeks and months.
“So far we’ve managed to muddle through this, because there’s been a big release of the stocks that were set aside for emergencies and we’ve seen China – the biggest oil importer from the Middle East – not importing as much,” he said.
“So far Australia’s managed to still get on okay, the poorer countries have really been affected more, but the longer this continues it’s going to start going up the ladder to higher income countries and could eventually get to Australia.
“And then there will be price impacts … Which can then be passed on to consumers, and that’s why we could be paying more for goods and food.”
In an effort to make up the shortfall from the Middle East, Australia has been importing oil and fuel from the US, West Africa, and even Argentina.
But he said now that the US was entering “driving season”, where domestic demand would increase, exports could dry up.
Extracted in full from: https://www.themercury.com.au/news/national/australian-businesses-face-dire-fuel-crisis-as-middle-east-war-hits-supply/news-story/f98e8ec531e5a4dc4257f3d8bd218396
