Australia Oil Refining Market Overview, 2030

Australia’s oil refining industry has undergone significant contraction over the past decade, reducing to just two operational refineries Viva Energy’s Geelong Refinery in Victoria and Ampol’s Lytton Refinery in Queensland following the closure of major facilities such as BP Kwinana in Western Australia and ExxonMobil’s Altona refinery in 2021. This shrinkage has transformed Australia into a net importer of refined petroleum products, with over 80% of its fuel now sourced from international markets, primarily Singapore, South Korea, and Japan. The closures were driven by financial unviability due to global competition, low refining margins, and the high cost of maintaining older infrastructure. In response to increased energy insecurity and fuel supply risks exposed during COVID-19 disruptions and global geopolitical tensions the Australian government implemented the Fuel Security Package, offering production payments to ensure the continued operation of the remaining refineries and to maintain minimum domestic fuel reserves. These facilities now play a limited but strategic role in the national energy value chain, focusing on transportation fuels such as diesel, gasoline, and jet fuel. Both Viva and Ampol have integrated operations linking refining, distribution, and retail networks. However, Australia’s refining sector faces energy transition pressures, with a need to reduce emissions and shift toward low-carbon alternatives. Renewable fuel production remains in early feasibility stages, with government interest in biofuels, hydrogen, and ammonia blending. Recent developments include Viva Energy’s plans for a hydrogen refueling station in Geelong and Ampol’s clean fuel research collaborations. Strategic fuel storage investments and regulatory measures such as the Minimum Stockholding Obligation (MSO) continue to support domestic resilience while the broader industry adapts to a future with fewer but more flexible refining assets. Michael Higgins from Milford Asset Management named the owner of the Geelong oil refinery and several Shell petrol stations among his top stock picks, even though he also predicts many people will be driving EVs within the next 15 years.

According to the research report ""Australia Oil Refining Market Overview, 2030,"" published by Bonafide Research, the Australia Oil Refining market is anticipated to grow at more than 6.17% CAGR from 2025 to 2030. Government subsidies totaling approximately AUD 2 billion in commitments under the Fuel Security Services Payment scheme have aimed to stabilize operations at Viva’s Geelong and Ampol’s Lytton sites, which together process about 14–15 billion liters of fuel annually. The COVID-19 pandemic underscored supply-chain vulnerabilities, prompting a national focus on energy security and critical fuel availability. Diesel and jet fuel stockpiling obligations have been introduced to ensure supply continuity in emergencies. In March 2024, Shell's Prelude Floating LNG project in Australia received approval from the Australian Competition and Consumer Commission, allowing the company to begin production. This development underscores the growing importance of liquefied natural gas (LNG) in the market as a cleaner alternative fuel source. Although domestic fuel demand is supported by population growth, road freight, and aviation recovery, regulatory mandates and carbon targets continue to pressure refiners to modernize or decarbonize. Refining margins remain highly sensitive to global crude pricing and crack spreads, with Australia’s small-scale operations at a competitive disadvantage compared to larger Asian complexes. There are no major refinery expansion projects, but opportunities lie in hybrid operations and digital upgrades to improve efficiency. Emerging policy interest in renewable liquid fuels and hydrogen is prompting feasibility studies, including hydrogen hubs at key ports and biofuel trials in aviation. Feedstock volatility, ESG compliance, and infrastructure aging pose persistent challenges. In 2023–2024, Australia’s Department of Climate Change, Energy, the Environment and Water released updates to the National Fuel Security Framework, reaffirming support for refining-linked infrastructure and transition funding, ensuring a path toward strategic resilience rather than volume growth.

Australia’s oil refining market shows distinct fuel type trends shaped by its geography, economy, and energy policies. Diesel dominates consumption, primarily driven by logistics, mining, and agriculture sectors, which require reliable, high-energy fuels for heavy machinery and long-haul transport across vast and often remote regions. Diesel remains critical for freight and rural operations, despite gradual efficiency improvements and the rise of alternative fuels. Jet fuel consumption in Australia centers around major international and domestic airports such as Sydney, Melbourne, Brisbane, and Perth. The aviation sector experienced a rebound post-pandemic, with increased domestic and international flights restoring demand for jet fuel. Conversely, gasoline demand has been declining steadily, mainly due to rising electric vehicle adoption, stricter fuel efficiency standards, and changing consumer preferences in urban centers. LPG is widely used in households and remote communities for cooking, heating, and small-scale power generation, offering a cleaner alternative to traditional biomass and solid fuels in isolated areas. Fuel oil consumption persists primarily in industrial sectors and power generation, although its share is shrinking due to environmental regulations and fuel switching. Lubricants and asphalt maintain stable demand in construction, manufacturing, and transport infrastructure. The fuel consumption pattern reflects Australia’s dispersed population, resource-intensive economy, and increasing focus on cleaner fuels.

Australia’s transport sector stands as the largest consumer of refined petroleum products, encompassing road transportation, freight logistics, and public transit systems that cover vast domestic distances. Diesel is the primary fuel for heavy-duty trucks, freight fleets, and agricultural machinery, supporting the country’s extensive mining operations and rural economies. Jet fuel consumption is centered on major international and regional airports, with Sydney and Melbourne acting as key hubs that handle significant volumes of passenger and cargo flights. Marine bunkering services cater to diverse maritime activities including coastal shipping, fishing fleets, and defense vessels, with key ports such as Brisbane, Fremantle, and Sydney facilitating fuel supply. In remote and off-grid areas, LPG and diesel fulfill critical energy needs, powering essential services and daily life in Indigenous communities, mining camps, and isolated settlements where electricity grids are unreliable or unavailable. The petrochemical industry in Australia is relatively modest compared to the refining sector but relies heavily on refined products as feedstocks for plastics, chemicals, and other industrial materials. Electricity generation from refined fuels remains minimal due to Australia’s reliance on coal, natural gas, and growing renewable energy sources. Other smaller but steady applications include rail transport, domestic waterways, and agricultural equipment, where diesel consumption remains significant. These applications reflect a diverse demand pattern that emphasizes transport fuels while supporting industrial and residential energy needs across the continent’s varied geography.

Australia’s refining operations predominantly depend on imported crude oil due to the country’s limited domestic crude production capacity. The majority of crude feedstock arrives via seaborne shipments from countries such as Malaysia, the United Arab Emirates, and Vietnam, ensuring supply to major refining centers located at Geelong in Victoria and Lytton in Queensland. The imported crude slate mostly consists of light and medium grades, which suit the relatively simple refining configurations of domestic refineries. Natural Gas Liquids (NGLs) production in Australia is limited and primarily serves the domestic energy market rather than refinery feedstock requirements. Biomass and alternative bio-feedstocks have yet to be integrated meaningfully into the refining process, although government initiatives are underway to explore renewable fuel options and diversify energy inputs in line with climate goals. Refinery feedstock supply chains are influenced by geopolitical factors and the global oil market’s price volatility, prompting refineries to maintain flexibility in blending crude types and adjusting processing parameters to ensure operational continuity and product quality. Petrobras and private operators focus on logistics management to optimize crude arrival, storage, and throughput. While biofuel blending is gaining traction downstream in the fuel supply chain, refinery feedstock diversification toward sustainable or synthetic alternatives remains in nascent stages. The feedstock strategy prioritizes stable, cost-effective crude supply with adaptability to evolving market and regulatory conditions.

Australia’s refining infrastructure primarily consists of low-to-mid complexity facilities focused on topping and hydro-skimming processes, exemplified by Viva Energy’s Geelong refinery and Ampol’s Lytton refinery. These refineries concentrate on producing fundamental fuel products such as gasoline, diesel, and jet fuel, with limited capacity for advanced conversion or residue upgrading. Either facility currently operates deep conversion technologies like delayed cokers or hydrocrackers, which restricts the ability to process heavier crude oils and generate higher-value refined products. The refining sector is undergoing gradual modernization, with government-backed initiatives promoting desulfurization upgrades to comply with increasingly strict environmental regulations on fuel sulfur content and emissions. Additionally, pilot projects are exploring integration of renewable diesel and sustainable aviation fuel (SAF) production within existing refinery infrastructure, reflecting Australia’s commitment to a cleaner energy transition. Investments in digitalization, automation, and operational efficiency enhancements support refinery reliability amid competitive market conditions. While deep conversion refineries remain absent, ongoing efforts focus on enhancing hydro-skimming capacity and preparing refineries to handle more complex feedstocks and renewable blends. The sector’s evolution is aligned with national climate targets and aims to balance environmental compliance with economic viability, securing Australia’s refining capability for future energy demands. These strategic improvements position Australia’s refining sector to better meet domestic fuel needs while gradually reducing its environmental footprint.

Considered in this report
• Historic Year: 2019
• Base year: 2024
• Estimated year: 2025
• Forecast year: 2030

Aspects covered in this report
• Oil Refining Market with its value and forecast along with its segments
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Fule Type
• Gasoline
• Diesel/Gasoil
• Jet Fuel
• LPG
• Fuel Oil
• Others (Lubricants, Asphalt)

By Application
• Road Transportation
• Aviation
• Marine Bunker
• Petrochemical Industry
• Residential & Commercial
• Electricity Generation
• Others (Rail & Domestic Waterways, Agriculture)

By Feedstock
• Crude Oil
• Natural Gas Liquids (NGLs)
• Biomass
• Others (Coal Tar, etc.)

By Complexity Type
• Topping
• Hydro-skimming
• Conversion
• Deep Conversion
• Others Show more