The federal government is today amending the Export Finance and Insurance Corporation Act so it can underwrite additional cargo loads of fuel.

Export Finance Australia will then provide importers with insurance and other financial assistance.

The new powers enable government to “work with fuel suppliers to keep fuel flowing to Australia”, Prime Minister Anthony Albanese says. 

“The deal-making expertise of Export Finance Australia will allow [it] to enter contracts of insurance or indemnity, give guarantees, make loans, or enter arrangements needed to help secure fuel supply from international markets.”

On Saturday, Energy Minister Chris Bowen said it is in the national interest that cargo comes to Australia rather than other countries.

“We want to help the companies make the decision to buy those cargoes ... We’ll be introducing legislation, which will give Export Finance Australia the capacity to have a very flexible suite of measures,” he said. 

“They can provide insurance, they can provide derivatives, they can provide loans and other arrangements to make sure that those companies can go and get those cargoes for Australia ... If prices continue to move around, there’ll be cargoes that Australia misses out on unless the government acts in close partnership.”

The new powers will be used to help buy additional supply only when the cost would be prohibitive for private suppliers without government support.

Mr Albanese says private purchases of fuel shiploads at higher prices are risky due to so much uncertainty amid the war in the Middle East.

“This is about risk mitigation for them to add to supply here,” he said. “It will give suppliers the confidence to secure additional and discretionary cargoes and use it to service uncontracted demand.

“Global price pressures and a doubling in demand has seen parts of Australia’s regional fuel market come under significant strain. This has had an unacceptable impact on regional customers who source their fuel this way, including farmers. 

“Eligibility for underwriting support will be structured to ensure additional supply can be delivered quickly through trusted operators with the capability and networks to get fuel where it needs to go.

“We are already in discussions with local and international fuel suppliers to help them source additional cargoes as needed.”

National cabinet met to discuss the Middle East fuel crunch for a second time this morning.