The Australian government this week announced plans to construct a new large-scale oil refinery in Western Australia. If approved, it would be the first refinery to be built since the 1960s.

The federal government initially touted the idea of a government-backed oil refinery in April. In the months since, Australians have grappled with surging petrol prices triggered by the prolonged US-Iran war.

The federal government, with Western Australia, has now announced it will jointly fund a A$4 million pre-feasibility study into a proposed large-scale oil refinery. This study will assess if Australia needs a new large-scale refinery and, if so, where it should go and how it should be operated.

This announcement raises several crucial questions: what is the government proposing? Could it shore up Australia’s fuel supplies? And what does it mean for emissions reduction?

The prolonged US-Iran war has revealed just how vulnerable Australia’s liquid fuel supply is.

Two decades ago, Australia had eight oil refineries. That number has dwindled to two – Queensland’s Ampol refinery and Victoria’s Viva energy plant – as ageing infrastructure and rising costs made these facilities uneconomical. For these reasons the Kwinana refinery – formerly Australia’s largest oil refinery located just south of Perth – shut down in 2021.

These closures have made Australia........

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