Australia held 33 days of diesel on 13 October as the Strait of Hormuz closed again; the reserve that would add ten more is due in 2030

When this was written — On 21 October 2026. The figures are as at that date or earlier and have not been updated since.

Eight months into the Iran war, the oil shock has entered a third phase. The first was the closure: within days of the strikes in late February the Strait of Hormuz was shut to all but a handful of ships, Brent went from about US$72 to above US$100, and the International Energy Agency ordered the largest emergency release in its history, 400 million barrels. 16 The second was the reopening, when flows recovered through the winter to more than 81% of the pre-war average by September. 2 The third began on 28 September. Kpler counted ten tankers struck in the strait in the week to 4 October; the UK Maritime Trade Operations centre logged fifteen more attacks between 6 and 14 October, eleven of them in four days. 2 Kpler's count, as OilPrice reported, citing Reuters, on 19 October, was at least eighteen in two weeks, and Brent traded that day at US$109.68. 3

The flow numbers tell it more sharply than the price. Gulf oil leaving through Hormuz averaged 17.1 million barrels a day before the war. It was back to nearly 20.8 million on 8 October. On 11 October it was 2.9 million. 2 Iran's security chief Mohsen Rezaei put the position plainly: "the strait is under Iran's control, and we manage it." 2 The IEA's response on 15 October was to accelerate about 100 million barrels of outstanding emergency releases, with some members now exceeding their original commitments, more than 20 million of it diesel, with members having drawn about 330 million barrels so far, and to warn that the global diesel shortage could last well into 2027. 4

This piece is about what that means for a country that makes a fifth of its own fuel, holds about five weeks of the rest, and has decided to build a reserve by 2030. The short-position data is at the end, because for once it is not the story.

How Australia gets its fuel

Australia is an energy exporter and a fuel importer, and the two facts have little to do with each other. In July 2026 the country exported 15.7 billion litres of LNG and 0.9 billion litres of crude, and imported 4.5 billion litres of refined products against 5.3 billion litres of fuel sold. The two remaining refineries, Ampol's Lytton in Brisbane and Viva's Geelong, produced 1.2 billion litres, and 0.8 billion litres of crude was imported to feed them. Those are the Department of Climate Change, Energy, the Environment and Water's monthly petroleum statistics, as Shorted holds them on its economy pages; the government's own summary is that domestic refineries provide "around 20% of national supply." 1

It was not always so. In July 2010 the refineries produced 3.7 billion litres and imports of refined product were 1.4 billion. The lines crossed in 2015, and since the last of six closures in 2021 the gap has widened to nearly four to one. Eight refineries operated twenty years ago; crude production, 800,000 barrels a day in 2000, averaged 220,000 last year. 5 The fuel in Australian tanks comes, overwhelmingly, from Asian refineries, on ships, with a voyage of two to three weeks.

The buffer, measured three ways

The number that matters is days of cover, and Australia publishes it. As at 13 October, fuel held under the Minimum Stockholding Obligation was 41 days of petrol, 33 of diesel and 28 of jet fuel: 1,730, 3,044 and 757 million litres, counting stock in the country and on water inside the exclusive economic zone. The March-quarter averages were 37, 32 and 30. 1 On 14 March, three weeks into the closure, SBS reported the same measure at 37, 30 and 29 days. 5 Diesel is the one that has not moved: 30 days in March, 36 at the end of August by the NRMA's reading, 11 33 now.

These are stocks reported under the MSO, separate from fuel already sold to customers. They are not a countdown to nationwide exhaustion: demand, continuing supply and local distribution all matter. 1

The arithmetic checks. July's diesel sales of 2,861 million litres are 92 million a day; 3,044 million litres is 33 days. A day of diesel in Australia is roughly 580,000 barrels, so the IEA's 20 million diesel barrels, which are for the whole membership, would be 34 days of this country's use if they were all delivered here. They will not be.

Second, what is on the water. As at 16 October there were six crude tankers bound for Australia, eleven days of refinery feed, and 42 product tankers carrying twelve days of refined fuel; at least 3.2 billion litres of crude, diesel, jet and petrol is scheduled to arrive in the next four weeks, about three fifths of a month's sales. 1 The government's summary is that "fuel continues to arrive in Australia in the quantities and at the frequency we need and expect." 1

Third, the number Australia does not meet. As an IEA member it is committed to holding 90 days of the previous year's net oil imports; it has been the only member short of that since 2012. 5 The minister's answer in March was that "our minimum stock obligations are high and that fuel continues to arrive". 5 The two measures are not comparable: the IEA counts net imports and excludes ships at sea, the domestic obligation counts consumption and includes them. The cited comparison puts South Korea above 200 days on its reported reserve measure, not on both of Australia's differently defined measures. 5

Sources: 1 5 8 11. The obligation was 24, 20 and 24 days under the 2022 rules and rose to 27, 32 and 27 in 2024. 8 In March the government released 20% of the obligation to the market, about six days of petrol and five of diesel, which is why the floor and the holding sat so close together through the autumn. 5

What ran out, and what was bought

The buffer held nationally and failed locally. About 500 rural service stations ran dry at the peak of hostilities, around March. 8 The policy response came in three parts. In March the government cut fuel excise by 32 cents a litre, halved the cut to 16 cents in July, and let it lapse on 3 August; the RACQ's forecast at the time was about $2.20 a litre for unleaded and $2.60 for diesel. 10 Export Finance Australia, under a $7.5 billion Fuel and Fertiliser Security Facility, secured more than 450 million litres of extra diesel and about 100 million litres of jet fuel, and more than a billion extra litres were brought in between March and June through relaxed stockholding rules, underwritten cargoes and a temporary petrol standard. R7

Then, on 6 May, the structural package: a government-owned Australian Fuel Security Reserve of about one billion litres of diesel and aviation fuel, costed at $3.2 billion; an uplift of about ten days in the stockholding obligation for every fuel, phased in and funded with $34.7 million over four years; and $10 million for refinery feasibility studies, with "at least 50 days" of diesel and jet fuel as the stated target. 6 The Opposition called it "too little, too late" and wants a 60-day obligation, which would take the total to 90. 15

The consultation paper released on 18 August gives the shape. One billion litres by 2030, roughly 80% diesel and 20% jet, about ten days of national consumption of each, owned outright by the Commonwealth and spread across four zones with at least 15% in each; the Northern Territory has offered Rio Tinto's seven tanks at Gove, 220 million litres with a deep-water port. Total federal fuel-security spending is put at $14.8 billion. Decisions are due by the end of 2026. 8 The minister's own summary: "it would have been better if we'd had more fuel in Australia when we came to office." 8

The refineries

Two refineries are the only domestic supply, and both are being paid to stay. The Fuel Security Services Payment's Phase 1 review in March raised its collar from 6.4 to 10.0 cents a litre with the cap unchanged at 1.8; Ampol deferred Lytton's turnaround from June to August to keep running through the crisis, worth about 300 million litres of extra output, and a temporary petrol standard let it sell 80 to 100 million litres a month more locally. 9 The feasibility money is for whether refining capacity can be kept or built beyond 2030. 6

The crisis has been good business for them. Ampol's third-quarter update this week R23 showed Lytton's refiner margin more than doubled on the prior corresponding period, and the company called the regional disruption a net positive for its supply chain; but an inspection of the fluidised catalytic cracker found more work than expected and the unit's restart has been pushed back, so petrol, diesel and jet output this quarter will be "materially lower" than forecast. 13 Kalkine reports the IEA recorded a record diesel refining margin in September, and Viva reported record first-half earnings from Geelong. 14 At the pump, the AIP's terminal gate price for diesel on 21 October was 263.1 cents a litre in Sydney and 253.2 in Perth, against 226.1 and 221.8 for petrol. 12 NRMA's Sydney retail average on 22 September was 237.8 cents for unleaded and 286.1 for diesel, with global diesel prices at record highs and inventories unusually low. 11

That is the structural fact of this crisis for Australia. The shortage is in diesel, not crude; Middle East refined-product shipments averaged 1.9 million barrels a day in September against 4.7 million before the war. 4 Australia imports its diesel finished, from refineries that compete for the same cargoes. A reopened strait fixes the crude market faster than it fixes the diesel one.

What short sellers did with it

For a national emergency, the short tape has been quiet, and Shorted has written about why: the reported positions varied sharply between companies, rather than rising uniformly across oil names. Every figure below is ASIC's daily aggregate, a percentage of shares on issue, on five dates: the eve of the closure, the April price peak, the June ceasefire, mid-July and the latest report.

Three things stand out. The refiners were de-shorted into the windfall: Viva's position is a sixth of what it was in February, and its shares went from $1.745 a year ago to $3.06 on 20 October, with a $3.18 high on 12 October. Ampol is the one energy name where a position was built during the crisis, from 1.07% in April to 3.17% in July; it has eased to 2.61% as the shares fell from a $44.07 high on 23 September to $39.32 after the Lytton outage. Beach remains the sector's structural short at 7.85%, with its price at $0.91 against $1.185 a year ago. Woodside, the stock most exposed to the price of what Australia exports, sits at 2.77%, where it was in June, with the shares at $33.82, up 51% in a year. Shorted's energy-sector average short position was 1.28% in March and 1.53% in September, below its 2025 level; the sector average was lower than in 2025; the comparison alone does not establish why.

As the crisis worsens

None of the data above forecasts anything, and this piece does not. What it allows is arithmetic about the buffer under conditions that have already occurred once this year.

If arrivals stop. The 33 days of diesel is a national average of stock in tanks and ships inside the EEZ. In March, with 30 days on the same measure, 500 rural stations ran dry, 8 because the number is not evenly spread and the last hundred kilometres is a truck. The 3.2 billion litres on order 1 is the relevant figure, and it is a four-week number that the government republishes; a fall in it would warrant investigation, but could reflect demand, scheduling or other factors as well as constrained supply.

If diesel stays short while crude does not. The refineries would keep making a fifth of supply from crude that still flows, and the diesel margin that doubled Lytton's earnings 13 would stay. The exposure is the four fifths bought finished, in a market the IEA expects to be short into 2027. 4 That is the case the reserve is built for, and it does not exist until 2030. 8

If the obligation is lifted again. The government has released a fifth of the floor once, for six days of petrol and five of diesel. 5 The planned ten-day uplift, when phased in, raises what that lever can release by about a third.

If prices do the rationing. Sydney diesel averaged 286.1 cents a litre on 22 September against 237.8 for unleaded, 11 and the excise relief is gone. 10 The transmission is through freight and farm costs, and it shows up in the CPI rather than the stock count. The 4.0% monthly inflation print for August is on the economy pages, where the petroleum series this piece draws on are updated monthly.

What the data does not show is intent. ASIC's aggregate records positions, not reasons; the stockholding figure records litres, not where they are; and the strait records ships, not whether the next one sails. The energy industry page carries every position in the sector, and the fuel statistics page 1 will show the days-of-cover figure before the stations do.

Method

Petroleum volumes are DCCEEW's monthly Australian Petroleum Statistics as Shorted republishes them (megalitres; July 2026 is the latest month), quoted in billions of litres. Days of cover are the government's own figures under the Minimum Stockholding Obligation, which count stock in Australia and on water in the EEZ against normal consumption; the IEA's 90-day measure counts net imports and is not comparable. Short positions are ASIC's daily aggregate for the dates named, read from the official CSVs; moves are in percentage points of shares on issue. Prices are closes. The crisis chronology before 14 October is as reported by the publishers cited, with Shorted's earlier pieces for the February and July episodes.

Disclosure analysis, not a recommendation to buy or sell.