Canberra and Singapore have deepened ties in energy trade and defence, concluding a new protocol signed to strengthen co-operation, Australia's federal government said today, as Australia grapples with supply uncertainty due to the ongoing Middle East conflict.
The new Protocol on Economic Resilience and Essential Supplies signed on 27 July delivers on a commitment made in April between the governments, to bolster security of essential supplies, including gasoline, an Australian ministerial statement said. Singapore makes up 55pc of Australia's gasoline imports. Meanwhile, the city-state supplies 15pc of gasoil and 23pc of jet fuel imports.
Singapore and Australia have committed to refraining from adopting or maintaining export restrictions on agreed essential items, according to a statement by Singapore's trade and industry ministry on 27 July. This includes items such as diesel and LNG. The protocol is also set to be included in the Singapore-Australia Free Trade Agreement.
Singapore's gasoline stocks rose by more than 92pc on the week to 22 July, while exports held steady, with Australia one of three key export destinations for Singaporean gasoline.
But Australia is vulnerable to supply chain shocks due to the country's reliance on imported fuels. Less than 25pc of demand can be met by domestic refining, due to a spate of facility closures in the past two decades.
State support
Concern about supply and high prices has led Canberra to underwrite fuel imports and temporarily cut the taxation rate for gasoil and gasoline, a measure intended to expire on 2 August.
Gasoline demand in Australia however may have peaked with significant demand reduction in reaction to rising prices following outbreak of the US-Iran war. Consumption fell by 7.1pc on the year to 251,000 b/d in May, official data released this month show.
Electric vehicle (EV) demand is also surging in Australia, with battery EV sales during June totalling 23.4pc of all purchases, up from just 8.3pc for all of 2025.
A new defence agreement was also signed between the parties today, with the Australia-Singapore Industrial Base Resiliency Arrangement to build upon existing co-operation between defence industries. Australia hosts Singaporean troops at vast training bases in Queensland state and also undertakes joint manoeuvres with Singapore.
