Saul Kavonic

So we'll actually fare relatively better compared to more developing economies who can't pay, and they're actually going to go without even more.

So what's most worrying now for oil markets is if this blockade

develops into the conflict restarting and Iran directly attacking oil infrastructure and oil export infrastructure like ports, which they've threatened to do.

And the reason for that is, is if you start to see more successful attacks on oil export infrastructure,

What it means is even after the war ends and the Strait of the Moors opens up, that will take months or even years to repair.

So we end up with a shortage of oil that will last much, much longer than the end of the war.

And that is actually a much scarier scenario for oil markets than just a short-term temporary disruption to the Strait of the Moors, which could open up readily again once the conflict is resolved one way or another.

It is.

Singapore is a major refining hub.

They refine much more oil than they need domestically.

And so what the government needs to do here is to make sure that that fuel is available for us to buy because we are approaching crunch point now where up until today we're still living off the oil that left the Strait of Hormuz before the war began.

That's about to dry up.

And what you're going to start to see is countries all over the region and around the world are going to start leaning on their political relationships, offering political favours and incentives to try and divert fuel away from Australia

and to their countries.

And that's why our government is engaging diplomatically now to try and fend that off and make sure that we can still compete and buy fuel on market and it's not taken away from us due to political reasons.

That is correct.

So...

Australia has leverage because right now, as difficult as the oil market is, the LNG market is even more difficult situation.

And many of these countries need our LNG even more than we need their fuel.

And so that gives the Australian government leverage in these discussions.