Australia’s manufacturing sector is set to receive targeted support under the Federal Government’s $14.8 billion fuel resilience package, with Treasurer Jim Chalmers outlining measures aimed at strengthening supply chains, securing fuel supplies and supporting domestic production amid ongoing global oil disruptions.
In his 2026–27 Budget speech in Parliament House, Canberra, Chalmers said the government was responding to “the biggest oil shock in history” with investments designed to support industry, logistics and manufacturing while improving Australia’s long-term energy resilience.
“We are responding to the biggest oil shock in history with a comprehensive $14.8 billion plan to secure more fuel, strengthen our supply chains, build resilience, and take the sting out of prices,” Chalmers said in the Budget speech.
The government said the package, titled Strengthening Australia’s Fuel Resilience, would deliver additional fuel supplies for industry, support fertiliser availability for agriculture, and improve fuel security across the economy.
Central to the measures is a $10 billion investment in immediate fuel supplies and a permanent Australian Fuel Security Reserve.
The government said it has already secured more than one billion additional litres of fuel between March and June through relaxed stockholding requirements, underwriting cargoes and adjustments to fuel standards.
The package also includes support directed at manufacturers and logistics operators dealing with supply chain pressures linked to the Middle East oil disruption.
“We’re helping businesses and manufacturers bolster supply chains, with $1 billion in interest free loans through the National Reconstruction Fund and incentives to get more freight moving on trains and ships,” Chalmers said.
The government stated that the National Reconstruction Fund’s Economic Resilience Program would provide interest-free loans to manufacturing and logistics businesses to help manage cashflow pressures and maintain production during the supply disruption period.
Additional measures include a $55 million pilot program aimed at increasing freight transport by rail and ship, alongside reforms intended to improve heavy vehicle productivity and supply chain efficiency.
The government also announced plans to reserve 20 per cent of gas exports for domestic use from July 2027, with the stated aim of improving local energy affordability and supporting industrial capability.
“We’re reserving 20 per cent of gas exports for Australian users so there’s more supply at lower prices,” Chalmers said.
The Budget further linked fuel security initiatives to the government’s broader Future Made in Australia agenda, with measures supporting domestic processing and manufacturing capability.
“And we’re making more progress on our Future Made in Australia agenda, supporting mining and processing through our Critical Minerals Strategic Reserve, and investments in domestic smelting and manufacturing,” Chalmers said.
The government also confirmed a $1.1 billion Cleaner Fuels Program to support domestic low-carbon liquid fuel production and future refining capacity. It noted the initiative is intended to reduce Australia’s reliance on imported fuels while supporting investment in cleaner fuel manufacturing.
Alongside the cleaner fuels measures, the Budget includes continued support for hydrogen production projects, electric vehicle adoption and charging infrastructure as part of a broader strategy to diversify Australia’s energy supply.
The government said it had strengthened support arrangements for Australia’s two refineries and committed funding for feasibility studies into expanding domestic refining capacity.
The government stated its approach focuses on “early action, close partnership with industry, and interventions that support markets rather than replace them” as Australia responds to ongoing global supply chain instability.
