National cabinet meets on Australia’s fuel crisis, with work from home, fuel excise relief and supply measures under consideration.

National cabinet has agreed to halve the fuel excise for three months and roll out a national fuel security plan, as the federal government moves to respond to the escalating fuel crisis.

The temporary measure will cut fuel prices by 26.3 cents per litre — or around $19 off a 65-litre tank — as part of a $2.55 billion package aimed at easing cost-of-living pressure and stabilising supply.

At the time of writing, there was no mention from the government about working from home measures.

Prime Minister Anthony Albanese said the government was acting early to shield Australians from the worst impacts of the crisis.

“We’re making fuel cheaper today because we understand that Australians are under serious pressure,” he said.

The package also includes a national fuel security plan and the temporary removal of the heavy vehicle road user charge for three months, alongside a six-month deferral of its next scheduled increase.

Prime Minister Albanese said the national fuel security plan would operate across four escalating levels, with Australia currently in a phase focused on “keeping Australia moving”.

At the lowest level, fuel supply operates normally with governments monitoring global conditions, though Albanese said Australia has already moved beyond this point.

The phase Australia is currently in centres on keeping fuel moving through the economy despite localised disruptions, with governments taking precautionary steps to shore up supply while encouraging voluntary changes, including using less fuel where possible.

If conditions worsen, the plan allows for more targeted intervention, including directing fuel to priority sectors and introducing coordinated measures to limit demand.

In a more severe scenario, governments would step in to protect critical services and ensure essential parts of the economy continue operating.

Treasurer Jim Chalmers said the package was expected to reduce headline inflation by around half a percentage point through to the June quarter of 2026.

Still, the government urged Australians not to stockpile fuel, encouraging consumers to “buy what you need” as part of efforts to ease pressure on supply.

States and territories are also working through measures to ensure they do not benefit from higher GST revenue driven by elevated fuel prices.

Prime Minister Albanese also said supply disruptions were ongoing but shipments to Australia had so far kept pace with demand.

He said all fuel shipments scheduled to arrive up to March 30 had been delivered, while in April, six expected shipments had been offset by nine additional cargoes.

Albanese said recent legislative changes would support the procurement of additional fuel supplies, including securing further “shiploads of fuel”.

“Got to be careful how I say that, shiploads of fuel arriving,” he said.

Fuel crisis response: excise cut, supply plan and emergency powers

Prior to the cabinet meeting the government said the measures were designed to avoid more disruptive interventions by acting early to reduce pressure on households and maintain fuel supply.

“The best way to avoid the kind of harsher COVID-style measures is to do that work,” Treasurer Jim Chalmers said.

Chalmers said the package would provide “timely, targeted and responsible” cost-of-living relief, with the excise cut expected to reduce the cost of a typical tank by about $19.

The federal government has also introduced legislation to expand its emergency spending powers, allowing up to $3 billion to be deployed to secure fuel supplies if needed.

The mechanism, overseen by Katy Gallagher, enables urgent funding to be allocated without prior parliamentary approval while parliament is not sitting.

Energy Minister Chris Bowen said the national fuel security plan would coordinate efforts across governments and industry to ensure fuel continues to reach critical sectors.

During the press conference Bowen said new powers would allow Export Finance Australia to support companies importing fuel, helping them manage the rising cost and risk of securing supply.

What the fuel crisis means for small businesses, tradies and transport operators

The outcome of today’s meeting will likely have significant implications for small businesses, particularly those reliant on transport, logistics, and in-person operations.

During the press conference, Prime Minister Albanese said the ACCC would closely monitor fuel retailers to ensure the excise cut is passed on to consumers.

“If you do the wrong thing by Australian motorists and truckies, the ACCC will come down on you like a ton of bricks,” he said.

Opposition Leader Angus Taylor said businesses and households are already feeling the strain.

“Businesses, our farmers, our tradies, our truckers… are all deeply concerned about whether they’re going to get the fuel they need to get the job done,” he said.

He also called for greater clarity from the government, adding: “We need transparency right now”.

Meanwhile, opposition energy spokesman Dan Tehan has stepped up calls for greater transparency around the fuel crisis, while declining to say whether a cut to the fuel excise could add to inflation.

“If the government wants to come out today and admit that [what we are experiencing] is actually a fuel shortage issue – and there are huge fuel shortages across the nation – well, that becomes, then, a different thing. But that’s not what they’re saying. They’re saying it’s a distribution issue,” he told Sky News.

Tehan said the national cabinet meeting needed to provide clearer visibility on supply pressures and the government’s response.

“That’s why national cabinet is so important, because we need that full transparency. We need that dashboard which will show where the shortages are and what’s been done to fix them. And we also need to make sure that we get the government acting.”

Free public transport debate: Victoria and Tasmania act, NSW holds back

One area already exposing policy divides between the states is public transport pricing. Victoria and Tasmania have moved ahead with temporary free public transport schemes aimed at easing household costs and reducing petrol demand.

Victorian Premier Jacinta Allan said the move was about immediate relief.

“We might not be able to control global oil prices, [but] what we can control is cost-of-living measures now,” she said.

New South Wales has ruled out short-term free travel, with Transport Minister John Graham warning the crisis may be prolonged.

“This situation will last more than a month… We need to keep our powder dry to be able to assist the broader economy,” he said.

Why fuel prices are rising in Australia: Middle East conflict and supply shock

The fuel crunch has been triggered by escalating conflict in the Middle East, which has disrupted supply chains and pushed prices sharply higher.

Unleaded petrol has climbed above $2.60 per litre in parts of Australia, with diesel exceeding $3 per litre, while concerns remain about supply in the weeks ahead.

Despite reassurances that Australia holds more than a month of fuel reserves, the government is under mounting pressure to act quickly to stabilise both prices and availability.

This story is updating…

This story first appeared on SmartCompany. Yu can read it here

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