INDUSTRY bodies have warned of the impact on the Australian logistics and transport sectors from the cutting of the crucial Strait of Hormuz at the entrance to the Persian Gulf.
Iran has essentially closed the strait to oil and gas exports, with media reporting four tankers being struck by drones since the weekend.
Economists quoted in the media have said even if a country doesn't buy directly from Middle East, it still pays the global benchmark price.
Victorian Transport Association chief executive Peter Anderson told DCN price increases and potential supply disruptions were always a concern.
“For freight operators, fuel is the largest operating cost after labour.
“Even relatively small increases can have a disproportionate impact on margins, especially for businesses operating on fixed‑price contracts,” Mr Anderson said.
“We’ve already seen diesel prices come under renewed upward pressure, and further escalation would intensify that risk.”
Mr Anderson said while physical shortages had not yet been seen at the pump, Australia’s limited onshore fuel reserves meant supply security is fragile.
“Any sustained disruption to global shipping or refining capacity increases the risk of tighter supply and higher prices,” he said.
Chief executive for the Australian Logistics Council, Hermione Parsons, said the nation’s freight and logistics sector was “highly exposed”.
“Diesel, the backbone of road freight, freight rail and coastal shipping, is largely imported, Dr Parsons said, noting current stock levels under Australia’s Minimum Stockholding Obligation provided around 32 days of diesel, well below the International Energy Agency’s 90-day benchmark.
“In operational terms, a full cessation of supply would leave the country with just over four weeks of diesel, illustrating the immediate risk to national freight operations.”
Dr Parsons said the ALC had long advocated for increasing minimum stockholding to meet IEA standards and for strengthening Australia’s sovereign fuel capability.
“We have also consistently highlighted the need to diversify energy sources through alternative fuels, electrification, renewable diesel and hydrogen — measures that reduce long-term exposure to geopolitical shocks while advancing decarbonisation,” she said.
The ALC has listed three imperatives including fuel security, sovereign capability and energy transition.
"The ALC will continue to work with government and industry to ensure Australia’s supply chains remain resilient, competitive, and capable of withstanding global energy disruptions," Dr Parsons said.
Australasian Supply Chain & Logistics Association chief executive Steven Ballerini said when vessels delayed or avoid transiting Hormuz, fleet capacity tightened.
Ships that would normally complete a round voyage within a defined window may instead remain idle or reposition elsewhere.
Insurance premiums are also recalibrating. War risk surcharges increase when hostilities intensify near major sea lanes. These additional costs are typically passed on through freight rates.
An extended period of elevated oil prices would complicate the global inflation outlook. Many central banks had begun to see moderation in price pressures. A renewed energy shock could reintroduce upward pressure on inflation expectations.