Diesel is firmly in the spotlight this week, although not necessarily available at a servo near you.
And the increasing price – despite a temporary cut in excise – is starting to have an impact on the resources sector that prides itself on fuelling the national economy.
Meanwhile, one of Australia’s biggest miners has upped the ante and kicked off an advertising campaign calling on the federal government to cap the fuel tax credit for it and 17 of its peers.
So what’s happening on the ground?
Nationally, the number of petrol stations with outages stood at more than 400 mid-week, or about 2% of tracked stations.
The federal government secured an additional 200 million litres of diesel this week, with Energy Minister Chris Bowen emphasising this was extra fuel.
“This is about protecting our country from the conflict in the Middle East and maintaining our fuel security,” he said.
However he warned the longer this war goes on, the larger the impact on Australia will be.
More than half the WA-focused companies surveyed by the Association of Mining and Exploration Companies have said they are taking some action to reduce fuel use, where possible.
Actions included winding back, delaying or cancelling drill programs, dropping night shifts for drill rigs and reducing travel, AMEC said this week.
The rolling survey of member companies found the impacts were being driven by the 200% increase in fuel price, not the lack of supply or access.
Explorers and miners can claim the full fuel tax credit on every litre of diesel – usually worth 52.6c a litre but currently 26.3c while the excise is halved until June 30.
And Australia’s 18 biggest miners get $3 billion in tax handed back every year through this subsidy, which isn’t fair according to Fortescue.
The iron ore major launched an advertising campaign on Wednesday proposing to cap the claim for it and the 17 other big miners, including BHP, Rio Tinto and Glencore, to $50 million a year.
The billions saved could be put towards helping with the cost of living, investing in lowering the cost of energy and supporting everyday taxpayers, Fortescue said.
The company cited its US$6.2 billion plan to eliminate fossil fuel use and reach “real zero by 2030” and said if Fortescue could achieve this so quickly, so could others.
At the smaller end of town, explorers were told the federal opposition reaffirmed its A$100 million commitment to extending the Junior Minerals Exploration Incentive, when leader Angus Taylor was in Perth this week.
The JMEI provides tax credits to investors in junior exploration companies, helping to attract capital for early-stage exploration.
AMEC urged the federal government to match or exceed the commitment, to provide long-term certainty for the exploration sector, particularly given the current environment of fuel security challenges.
However any certainty, along with long-term diesel reserves, is seemingly in short supply.
