Geelong oil refinery fire dents Australian aviation fuels supply, with particular concern for AvGas
Australia’s aviation sector is nervously awaiting updates on the impact of a fire at the only oil refinery in Australia that produces fuel for jets and smaller planes.
Australia’s aviation sector is nervously awaiting updates on the impact of a fire at the only oil refinery in Australia that produces fuel for jets and smaller planes.
The blaze at Viva Energy’s facility in Geelong in Victoria couldn’t come at a worse time, with both of the nation’s major airlines Qantas and Virgin this week deciding to trim domestic capacity as the Middle East conflict sends jet fuel prices soaring.
Australian Airports Association chief executive Simon Westaway said it was a serious incident but fortunate no injuries had been reported.
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By continuing you agree to our Terms and Privacy Policy.“We understand jet fuel production at the facility is continuing at reduced levels,” Mr Westaway said on Thursday.
“Australia’s aviation sector sources jet fuel from a range of suppliers, with the majority of refined fuel coming from offshore.
“Australian airports will continue to monitor the situation closely and are continuing to engage with the Federal Government to ensure jet fuel supply is maintained.”
Mr Westaway suggested the impact to AvGas supply, which is mainly used by smaller piston-engine and general aviation aircraft, could be bigger.
ASX-listed Viva Energy, which entered a trading halt immediately after the blaze, has been sought for comment on reports the section of the refinery that produces AvGas has been damaged.
It’s understood the facility accounts for a large portion of domestic AvGas supply, but just 10 per cent of jet fuel used in Australia.
Separately, Morningstar unwound its previous ratings downgrade for Virgin because the airline’s jet fuel hedging was stronger than expected.
“Virgin’s 71 per cent hedge on its fiscal 2026 jet fuel spread provides greater protection from the fuel shock than peers,” senior equity analyst Angus Hewitt said.
“This is unusual and likely reflects a preference for earnings stability in its first full year after listing.
“Fuel volatility can lead to short-term earnings swings, but has a lesser impact on long-term profitability as all players bear the cost almost equally.”
Ampol operates Australia’s other remaining oil refinery, the Lytton facility in Brisbane, where it is looking at establishing renewable fuels production, including sustainable aviation fuel, in a partnership with GrainCorp.
