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Global Market Conditions
Sustained elevated crude oil prices continue to shape fuel costs across the Australian market. OPEC output restrictions, estimated at approximately 5.86 million barrels per day below production capacity, have maintained upward pressure on global supply throughout 2025 and into 2026. Combined with increased global energy demand and supply disruptions, world oil markets remain in a period of elevated price volatility.

From early 2026, escalating conflict in the Middle East has introduced additional uncertainty into global oil supply chains. IBISWorld analysts are currently tracking the potential flow-on impact across 35 Australian industries, including:

• Manufacturing
• Freight and Logistics
• Chemical manufacturing
• Fuel production
• Fleet leasing
• Oil and Gas industry
• Mining

Australia’s Fuel Supply Structure
Australia’s fuel supply is heavily reliant on imported refined petroleum products, primarily sourced from Asian refining centres, including Singapore. Over the past decade, a number of domestic petroleum refineries have closed and been converted to fuel import terminals. According to IBISWorld’s Bulk Fuel Storage in Australia report (March 2026), this structural shift has increased Australia’s dependence on imported supply and elevated the strategic importance of domestic storage capacity.

Domestic fuel supply volumes have remained below the internationally recommended 90-day reserve benchmark. As of March 2026, Australia holds approximately 36 days of petrol and 32 days of diesel in reserve. In response to current supply risk conditions, the Australian Government has activated emergency fuel reserves and increased funding directed towards expanding diesel storage capacity.

Stephen Koukoulas, NCI’s Economist in Residence says “What is also a significant uncertainty is the availability of petrol, particularly in some rural and regional areas. This has been driven by what might be termed ‘panic buying’ which has drained retail inventories. The mining, transport and agriculture sectors have experienced shortages in regional areas.”

Industry Performance and Margin Conditions
According to IBISWorld’s Fuel Retailing in Australia report (March 2026), the industry generates approximately $56 billion in annual revenue. Despite elevated retail prices, profit margins remain constrained, sitting at approximately 3.4% for retailers. Wholesale fuel distributors operate on an average margin of 1.7 cents per litre, reflecting the high-volume, low-margin nature of the sector.

The Australian Competition and Consumer Commission (ACCC) has announced increased scrutiny of retail fuel pricing and has required fuel retailers to provide formal explanations for current pricing behaviour. The Victorian Government has separately flagged regulatory measures to limit fuel price increases in that state.

Trade Credit Conditions
NCI’s Trade Credit Statistics report for December 2025 records a material escalation in claims activity within the Fuel sector. Claims received from fuel distributors in 2025 reached $3.7 million — more than three times the value recorded in 2022. The majority of claims relate to business failures within the road transport and logistics sector, where sustained fuel cost increases have contributed to financial stress across parts of the supply chain. Elevated fuel costs have also been a contributing factor to broader inflationary pressure, including increased freight and transport costs flowing through to end consumers.

Outlook
IBISWorld forecasts that bulk fuel storage revenue will grow at an annualised rate of 1.3% through to 2030–31, supported by continued demand and government investment in storage infrastructure. A recent APAC benchmark report has identified renewable and alternative fuels as a longer-term pathway towards greater fuel security, with accelerated domestic adoption offering the prospect of reduced reliance on imported petroleum products. In the near term, market conditions are expected to remain subject to volatility driven by global supply dynamics, exchange rate movements and evolving domestic regulatory requirements.