The Australian government is considering increasing the ethanol content in petrol to bolster fuel supplies as the Middle East conflict drives up prices and threatens economic stability. The move, backed by the NRMA, comes amid warnings from farmers that food prices will soon rise due to soaring production costs.
Treasurer Jim Chalmers told business leaders on Tuesday that the end of the war “can’t come soon enough” for the Australian economy. “We are well placed and well prepared, but we will be buffeted,” he said at a Business Council of Australia dinner.
National Farmers’ Federation president Hamish McIntyre warned that food prices could “get very serious” for consumers over the next month. “We’ll be passing that on. We have to, in order to remain viable,” he said, adding that the crisis would drive inflation and interest rates.
Smaller mining companies have already begun scaling back operations due to diesel shortages, with some reducing non-essential activities. Warren Pearce, CEO of the Association of Mining and Exploration Companies, called on governments to pressure major fuel wholesalers to ensure supplies reach smaller distributors.
Energy Minister Chris Bowen announced a six-month loosening of diesel standards to allow imports from more markets, including the US, Canada, and the EU. A spokesperson for Bowen confirmed that his department is examining whether higher ethanol levels could help without compromising safety.
NRMA spokesperson Peter Khoury backed the use of E10 and even higher blends like E15, noting that other countries are already using them. “Encouraging people to use it as an option is something we can do in the short term,” he said.
