Australia fills up at the Singapore servo
Australia has been caught nearly out of fuel twice in a decade. A quiet trade deal amendment with Singapore is the government's answer — but is it a strategy or just a queue-jump?
Australia has twice, in living political memory, discovered that it was nearly out of petrol. Twice the government of the day scrambled for a response. And now, quietly, through an amendment to a two-decade-old trade agreement, the current government is trying to make sure it does not happen a third time by locking in a formal arrangement with Singapore to guarantee access to refined fuel in a crisis.
Australia refines almost none of its own fuel — and has the crises to prove it
The context matters here. Australia refines almost none of its own liquid fuel. The Altona refinery in Victoria, Australia's smallest domestic refinery, closed in 2021. What remains is import dependency, thin commercial stockholdings, and an International Energy Agency obligation to hold ninety days of net import cover that Australia has never reliably met and has repeatedly been embarrassed about not meeting. When global supply chains tightened, first during COVID and again when oil markets convulsed after the Russian invasion of Ukraine, the exposure was impossible to hide. We were, in the memorable phrasing that did the rounds in Canberra, three weeks from running dry.
Singapore is a logical partner for this kind of arrangement. The city-state is one of the world's great refining hubs, sits at the top of the regional fuel supply chain, and already has a deep trading relationship with Australia under the original 2003 free trade agreement. The new protocol, now before the Joint Standing Committee on Treaties, would formalise preferential access to essential supplies, including refined petroleum products, in conditions of genuine emergency. It creates a framework for the two governments to cooperate on supply assurance rather than simply leaving Australian importers to compete on the spot market when global supply gets tight.
It does not build a single new litre of storage on Australian soil. It does not reconstitute domestic refining capacity. What it does is secure a preferential queue at someone else's servo when things get bad.
A preferential queue is not the same as a tank of your own
The design logic is sound enough. Bilateral supply protocols of this kind are standard practice among economies that recognise their import exposure and have had the sense to do something about it before the crisis rather than during it. The existing relationship with Singapore lowers the political and commercial friction of making such an arrangement work. And the treaty amendment mechanism means it carries legal weight rather than sitting as a memorandum of understanding that a future Singapore government can quietly set aside.
But the honest reading of what this protocol does and does not do matters. It does not build a single new litre of storage on Australian soil. It does not reconstitute domestic refining capacity. It does not change the underlying structure that leaves Australia dependent on foreign refiners and foreign storage to meet a domestic need. What it does is secure a preferential queue at someone else's servo when things get bad. That is genuinely useful. It is not the same as having a tank of your own.
The Opposition has been consistent in pointing to this gap. The argument, made repeatedly in recent weeks, is that fuel security ultimately starts with Australian production, Australian refining, and Australian storage, not with diplomatic arrangements that depend on a third country's goodwill and capacity. That critique has structural merit, even if the practical pathway to rebuilding domestic refining is neither cheap nor quick. Altona did not close because of a policy failure in isolation; it closed because it could not compete with the scale and efficiency of Asian mega-refineries, Singapore's among them. Reversing that through subsidies or mandates would cost serious money for uncertain long-run benefit.
The test is whether this protocol is a first step or the final answer
Which is why the Singapore protocol, for all its limitations, represents the more pragmatic short-term option. The IEA stockholding obligation is not going to be met by building a new refinery in the next five years. It can be partially addressed by ticketing access to existing refining and storage capacity in a partner country with aligned interests and a track record of reliable supply. The question is whether this is a first step in a genuine strategy or whether, as we have written before, Australian governments will once again treat the patch as the plan.
The committee process will test that. If the protocol passes into law and sits alongside serious progress on domestic stockholding obligations, onshore storage investment, and a credible IEA compliance pathway, it will look like one piece of a real strategy. If it passes and becomes the answer given every time fuel security comes up in Senate estimates, it will look like what it is: a government that got caught out twice, found a face-saving bilateral fix, and moved on.
Australia's fuel position is structurally exposed and has been for years. The Singapore protocol improves the management of that exposure without resolving it. That is worth doing. It would also be worth saying so plainly, rather than presenting a queue-jump at a foreign refinery as energy sovereignty.
Sources
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Frequently Asked Questions
What does the new Singapore-Australia fuel protocol actually do?
The protocol amends the 2003 Singapore-Australia Free Trade Agreement to give Australia preferential access to Singapore's fuel reserves and refining capacity during supply emergencies. It creates a legally binding framework for supply cooperation rather than leaving Australian importers to compete on the spot market when global supply tightens.
Why doesn't Australia just refine its own fuel?
Australia's last major domestic refinery, Altona in Victoria, closed in 2021 because it could not compete with the scale and efficiency of large Asian refineries, Singapore's among them. Rebuilding domestic refining capacity through subsidies or mandates would cost serious money for uncertain long-run benefit, which is why successive governments have not pursued it.
How close did Australia come to running out of fuel during COVID and the Ukraine war?
During both crises, Australia's thin commercial stockholdings and import dependency were fully exposed. The phrase that circulated in Canberra at the time was that the country was three weeks from running dry — a figure that reflects just how little domestic buffer actually existed.
Does this protocol mean Australia has met its IEA fuel reserve obligations?
No. Australia has an IEA obligation to hold ninety days of net import cover and has never reliably met it. The Singapore protocol improves access to foreign refining capacity in a crisis but does not build new storage on Australian soil or change the underlying structural exposure.
Why is Singapore the right partner for this kind of arrangement?
Singapore is one of the world's great refining hubs and sits at the top of the regional fuel supply chain. The two countries already have a deep trading relationship under the 2003 free trade agreement, which lowers the political and commercial friction of making a supply-assurance arrangement work in practice.