QTLC Interviews Business Leaders about the Fuel Situation

As the war in the middle east continues, QTLC interviewed three business leaders, each from diverse fields, about the impacts to their business, and their long-term views on what we need to learn from this event.

Our Leaders:

What are the immediate impacts of the current fuel situation on you/your business?

Tracie – At first, it was our cashflow situation to pay for the fuel – for example on 1 March diesel was 1.61/L and at the end of the month it was $3.2/l. You can imagine the ramifications straight up. Our profits are in single digits and there isn’t an abundance of spare cash sitting around to pay for these sorts of increases.

Drew – The past couple of months have been genuinely challenging for fuel-dependent businesses across Australia. A mix of global instability, disrupted supply chains and currency pressures has created a highly volatile market that moves faster than most operators can realistically plan for. For organisations running large fleets or operating remote sites, that volatility translates quickly into material cost pressure.

For IOR, the challenge has been two-fold: navigating the market conditions ourselves while continuing to keep customers reliably supplied. That requires constant, real-time decisions around inventory and logistics, particularly for mining, freight, agriculture and construction customers who simply cannot afford disruption.

One positive outcome has been decisive action. On 15 April 2026, IOR and the Federal Government, through Export Finance Australia, agreed a commercial framework that enables additional fuel cargoes to be brought into Australia. This allows supply to be secured beyond contracted volumes, with Government support helping manage price volatility and working capital risk. It’s a targeted response aimed at the regions and industries experiencing the greatest pressure.

April – Across our region, the impacts are immediate and widespread. Our region that contributes more than $25 billion to GDP and underpins key national supply chains. Fuel costs and availability are flowing directly through to transport, agriculture, manufacturing and construction, putting significant pressure on already tight margins.

We are seeing steady disruption to operations, with cashflow pressures across the supply chain. As one member put it, “higher logistics costs are reducing export margins significantly, while input costs continue to rise.” Others are seeing more acute impacts, with clients off-hiring equipment, deferring work and, in some cases, reducing workforce.

Through our recent member briefing with Drew Morland, it was clear just how quickly this has escalated. Australia began feeling the impacts of global disruption within 2 weeks, reinforcing how exposed the system is to supply shocks.

What longer term impacts are you concerned about?

Tracie – I think we’ll see longer term effects hit in June/July. I don’t think price increases have hit the mums and dads yet. For example, I was at a coffee shop this morning and they were complaining that coffee has gone up 10pc. I explained the supply chain impacts on the economy. Their question was, well, will we see these price increases continue to increase, and be baked into the future?

For us, it’s managing cashflow again and understanding what the long-term impacts are on the economy and business that we work for that will affect us.

Drew – My longer-term concern is whether Australia uses this period to develop a clearer, more realistic view of what fuel security requires, or whether we revert to old assumptions once conditions ease. Over time, the closure of major coastal refineries and growing reliance on imports were largely accepted as economic necessities.

What recent events have highlighted is how exposed that approach leaves businesses and communities when global conditions deteriorate. Without stronger domestic safeguards, the system remains fragile. Australia’s minimum fuel stockholding levels are too low, leaving little buffer when supply tightens.

April – Australia’s reliance on imported fuel and a predominantly road-based freight system leaves regional economies exposed when global conditions tighten.

We are already seeing second-order impacts across supply chains: fertiliser contracts broken, reduced planting intentions, and uncertainty around export markets. With El Niño conditions emerging, many growers won’t take the chance and will sit out or reduce planting following several strong seasons.

At a business level, the consequences are material. One member noted that fixed-price service contracts are now operating at a loss due to fuel costs, with travel alone costing up to $700 per job, while others have flagged that projects may be delayed or shelved due to cost escalation.

Without change, we risk embedding higher costs, reduced productivity, and major project delays.

What steps are you taking to negate these impacts?

Tracie – Straightway we stopped spending. Now it’s all about being very diligent about what we’re spending money on – justifying every single expense. As a business, we can’t control the economy so for us it’s taking steps that we can, to watch expenditure, wages, and even acceleration in trucks (to save the decimal points!). We’re fortunate that we work with blue chip companies that have all instigated a fuel levy, reviewed fortnightly.

Drew – In the short term, our focus has been disciplined supply management to ensure fuel continues to reach customers who cannot tolerate interruption. IOR delivers more than 1.6 billion litres annually through a national network of 116 unmanned 24/7 truck stops, 39 airport refuelling facilities, two major diesel import terminals and 17 regional depots. That infrastructure has been critical in responding quickly as conditions shifted.

Equally important has been how our teams have supported customers. Rather than waiting for issues to escalate, our people proactively contacted customers ahead of the worst disruption. These were not easy conversations, but they were honest and practical, focused on pricing protections, available tools and helping customers make informed decisions during a difficult period.

Structurally, the commercial framework agreed with the Federal Government and Export Finance Australia on 15 April 2026 is a meaningful step. It allows IOR to procure additional cargoes in the national interest that would not otherwise be commercially viable. With 87% of our volume distributed outside major cities, we are well placed to direct that supply to regional Australia, where impacts are often felt first.

Looking ahead, we remain engaged with producers exploring the Taroom Trough, which has genuine potential as a domestic source of condensates and crude. Alongside that, we will continue building capability and advocating for policy settings that strengthen Australia’s fuel resilience over time.

April – Our role is to bring industry together and ensure regional voices are heard in national decision-making. We are actively engaging with both State and Federal Governments, including contributing insights into the State and National Fuel Supply Taskforce to ensure regional impacts are clearly understood.

Importantly, we are also supporting our members directly. TSBE has hosted targeted briefings and webinars to guide businesses through the crisis—sharing practical steps such as contingency planning, securing contracted supply, and managing cash flow and credit exposure.

Our recent webinar with IOR, which saw close to 100 businesses participate, reinforced both the scale of the challenge and the importance of practical, real-time decision-making to maintain resilience.

At a regional level, we are also focused on longer-term solutions. Recently, we brought together more than 200 businesses in Miles to discuss the Taroom Trough, which has the potential to strengthen domestic fuel supply over time.

This work is critical in a region with more than $20 billion in project pipeline, where investment confidence is directly linked to supply chain reliability and cost certainty.

What is the one thing you think we need to change coming out of this crisis?

Tracie – The amount of fuel we hold in Australia.

Drew – Australia needs a firm, long-term commitment to higher minimum fuel stockholding levels. The current settings leave the system too thinly buffered, increasing risk when global conditions tighten.

April – We need to invest in structural solutions that improve resilience and reduce reliance on road-based freight.

Inland Rail is a clear example. It provides a long-term solution to take pressure off our road networks and improve supply chain efficiency. Analysis shows potential savings of around $10 per tonne compared to coastal rail and up to $35 per tonne compared to road freight, equating to up to $110 million per year in savings versus trucking.

Beyond cost it delivers resilience, diversifying freight routes and reducing exposure to fuel volatility.

TSBE has written to Minister Catherine King to advocate for Inland Rail and particularly the Gowrie section, to be prioritised in the upcoming Federal Budget. This is exactly the type of productivity-enabling infrastructure that can address the structural challenges exposed by the current crisis.

If there is one change to come from this moment, it should be a stronger national focus on fuel security, freight diversification and infrastructure investment that supports regional Australia