Australia Energy: Budget Implications – A$10b Fuel Security & Resilience

Research evidence excerpt

Australia Energy: Budget Implications – A$10b Fuel Security & Resilience

Update

May 12, 2026 12:47 PM GMT

Morgan Stanley Australia Limited+MAustralia Energy | Asia Pacific Rob Koh

Equity Analyst

Budget Implications – A$10b Rob.Koh@morganstanley.comMaya Blackman +61 3 9256-8932

Research Associate

Maya.Blackman@morganstanley.com +61 2 9775-2213

Fuel Security & Resilience Samantha R Edie

Samantha.Edie@morganstanley.com +61 2 9770-1671

Key Takeaways Morgan Stanley & Co. International plc+

We view the finalised fuel security and resilience policy as a small positive for Charlotte Firkins

Commodities Strategist

ALD and VEA, with confirmed financial support for near-term fuel purchases. Charlotte.Firkins@morganstanley.com +44 20 7425-3866

We think MSO increases over time will add to company working capital and

Australia Energy

storage investment requirements, but we anticipate policy support for this. Asia Pacific

Industry View In-Line

Turning to fuel supply, we estimate onshore stocks plus oil on the water sees

Australia's fuel supply secure to mid-July, however jet fuel loading is down WoW.

Our stock views: Australia Downstream Energy:

Diesel Terminal Gate Pricing is averaging A$2.24/L so far in May (down from A

Looking through the Cracks (27 Apr 2026)

$2.72/L in Apr-26, but well above A$1.58/L a year ago in May-25).

VEA's Geelong Refinery is running at ~60% petrol capacity and ~80% diesel and Primer: Australia's Fuel Supply (16 Mar 2026)

jet fuel, targeting >90% from ~27 May 2026.

Macro view: Australia Macro+ Matters: Diesel

What happened? The Australian Government announced a "Fuel Security & Supply Fuelling Uncertainty (19 Mar 2026)

Resilience package" on 6 May 2026, which is confirmed in the Federal Budget on 12

May 2026, including: