SYDNEY | Australia announced Wednesday that it intended to take advantage of the prices, historically low petroleum to be a strategic reserve of black gold, which will be located in the United States.
With the containment measures imposed to halt the spread of the COVID-19, the international demand for oil has dropped and prices have collapsed.
The situation is then ripe for action, said the australian minister for Energy Angus Taylor.
Australia has long had one of the lowest levels of emergency oil stocks in developed countries, which makes it particularly vulnerable in the event of tensions in certain strategic regions such as the strait of Hormuz, located between Iran and the Sultanate of Oman.
Mr. Taylor said that Australia was going to unlock 94 million australian dollars (84.4 million $) to start to build up a stock of oil located on american soil.
“This is a unique opportunity to begin to build a reserve of oil, because prices are historically low”, he stressed.
“This is the time to act. We act with the storage to which we have access and which is currently located in the United States”.
The two allies signed an agreement in early march to Australia to rent space in the strategic reserve u.s. oil and which could be accessed in case of an emergency.
Mr. Taylor has indicated that storage of oil belonging to Australia were already saturated.
However, the government has begun negotiations with the industrial sector of australia to develop to term the storage capacity of the country.
“In the event of a disruption of the world, which would slow down the supply of fuel (…), we will have access to the fuel needed to run our country,” he explained.
This agreement will allow Australia to begin to comply with the obligations of the international energy Agency (IEA), which recommends that its members hold oil stocks available in case of emergency equivalent to at least 90 days of net oil imports.
Mr. Taylor stated that the country had currently 20-to 30-day supply of consumers on australian soil, but this level fluctuates.