Fuelled by subsidised diesel, Australia is running dry

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Australia was once said to have been “built on the sheep’s back” — a recognition that wool played a central role in its economic growth. These days you might say it floats on a lake of diesel.

No major economy uses the fuel more lavishly. Consumption runs to about 7.7 barrels per person, per year, sufficient to fill the tank on a Ford F-150 pickup nine times over. That’s about 80 per cent above US levels, and eight times more than China.

With the global petroleum supply chain starting to seize up due to the crisis in the Strait of Hormuz, prices have risen more than 50 per cent in a matter of weeks. Shortages are looming.

Garbage companies have warned that waste collections may be cancelled as trucks run short. Hundreds of petrol stations are out of at least one type of fuel. Farms have postponed crop seeding because their tractors can’t be refilled. Truckers are getting stranded at drained outback filling stations. Charter fishing boats operating out of Sydney Harbour face squeezed margins.

The government is dismissing talk of rationing, but has relaxed safety regulations to draw more supplies in from overseas. The market looks worryingly tight.

For all that, you can blame decades of complacency and misguided subsidies. Other countries shouldn’t assume they’re........

© The Sydney Morning Herald