Coronavirus: G20 nations urged to stabilise global oil markets

Angus Taylor has urged the world’s leading economies to take action in addressing ‘current ­excess oil supply’.

Energy Minister Angus Taylor. Picture: AAP

Australia has called for G20 nat­ions to maintain stability in global oil markets during the COVID-19 pandemic and support long-term fuel security and incentives for local investment to combat ­storage issues and pressure on ­refineries.

In a virtual meeting of G20 energy ministers on Friday night, Angus Taylor said Australia was “seeing impacts on our refineries, including storage and shipping cap­acity” as demand declined and “refining margins move to unsustainable levels”.

The Energy Minister urged the world’s leading economies to take action in addressing “current ­excess supply”.

“The price and supply of oil is clearly an important issue in the current circumstances. Australia and Australians rely on energy availability at sustainable, affordable prices without unnecessary volatility,” he said.

“In this spirit, we believe action needs to be taken to address current excess supply. Australia is committed to open and transparent global energy markets.

“We believe there is a need to take action to stabilise oil markets at supply and price levels that support ongoing investment, supply diversity and energy security.

“I hope we can ease market volatility and restore confidence. This will send the signals for continued investment to maintain energy security and affordability.”

As weekly petrol prices across Australia dropped by an average 20.5c a litre compared with the same period last year, Mr Taylor encouraged all countries to “behave in a sustainable way and act within their capacity to help reduce volatility in the market”.

He said prior to the Inter­national Energy Agency calling on countries to buy oil to support demand ahead of the COVID-19 pandemic, Australia had “already been advancing a program to enhance our oil reserves”.

Australia was “well progressed” in negotiations with the US government, Mr Taylor said, and was “seeking to finalise commercial terms” to strengthen its fuel ­reserves.

He thanked the US for helping Australia enhance its domestic fuel security and supporting global oil markets during the coronavirus crisis.

“The recently agreed Australia-US Strategic Petroleum Reserve Arrange­ment places Australia in a good position to build up strategic reserves,” Mr Taylor said.

The Morrison government believes if all nations acted within their capacity to reduce volatility in the market, it would help “stabilise markets now and in the long term”.

Mr Taylor said stability in the market would support economies recovering from the shock of COVID-19.

“Part of our collective response must be to focus on continuing trade and supply chains, with ­appropriate health and safety considerations, to ensure we minimise the shock to the global economy and are well placed for recovery,” Mr Taylor said.

“Along with our crucial health workers, the Australian government is prioritising workers in the energy sector to ensure we maintain resilience, keep local economies going and maintain crucial services.

“We are working to keep the lights on and keeping goods and people moving.”

Mr Taylor said G20 nations had an important role to play in “calming international energy markets, maintaining market ­stability and addressing energy ­security”.