How soon could Australia face a diesel squeeze? | The Business

Thu, 30 Jul 2026 12:32:45 +0000

Kevin Morrison from the Institute for Energy Economics and Financial Analysis says the regional diesel price is trading higher than ever before because the US-Iran conflict is restricting oil shipments through the Strait of Hormuz and there's a squeeze on refining capacity drving up prices. He said the crude coming of the Middle East is more suited to making diesel than petrol.

He says Australia is big importer and consumer of diesel and has a month's stockpile left, "well short" of the international benchmark. And he says while more than 75 per cent of the world's oil is still flowing, it will take a while before stockpiles diminish. But he says without positive developments in the Strait of Hormuz "we could be back to a very tightening situation come September, October."

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