Two Australian states are set to introduce temporary free public transport to ease the impact of rising fuel costs, as supply concerns grow amid escalating tensions in the Middle East and the ongoing conflict involving Iran.
The government of Victoria announced that residents will be able to use public transport at no cost for one month starting March 31. Meanwhile, Tasmania confirmed it will waive fares on buses and ferries from March 30 through July 1.
Australia is facing increasing risks to fuel supply, with hundreds of service stations reporting shortages and disruptions affecting key sectors such as agriculture and mining.
Prime Minister Anthony Albanese said Friday that short-term fuel supplies remain secure, aiming to reassure households and businesses amid growing concerns.
Rising fuel prices are also complicating inflation forecasts for the Reserve Bank of Australia, according to Bloomberg. Price pressures had already been building before the supply shock linked to the Middle East conflict.
The central bank recently raised its benchmark interest rate to 4.1%, a decision that divided policymakers, and markets expect further rate hikes later this year.
Australia also announced new powers to strengthen fuel supply security, including plans for the government to ensure private sector access to international fuel markets. The measures are expected to be presented to parliament on Monday.
Since the conflict with Iran began on February 28, the potential closure of the Strait of Hormuz has become a major concern for the global economy.
The waterway, which previously handled about one-fifth of global oil supplies, remains a critical chokepoint, with disruptions contributing to rising fuel prices and reduced output across the region.
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