Energy producers have been calling for the government to remove restrictions on the gas market to prevent potential shortages on Australia’s east coast. This comes after the Australian oil and gas industry warned of upcoming gas shortages as early as 2027. The government had originally implemented the wholesale gas price cap to combat soaring domestic energy prices in response to the conflict in Ukraine. The intended purpose was to lower gas price increases by 16 percent, but the measure was met with pushback from companies and energy experts who warned that it would disrupt domestic energy supplies.
The Australian Energy Producers urged the government to use the 2024-2025 federal budget to end market intervention measures and remove the gas price cap. They stressed that these price controls should not become a permanent fixture in the energy market and emphasized the urgency of unlocking more land for oil and gas exploration. In response to these concerns, the Australian Competition and Consumer Commission (ACCC) reported that the combination of the emergency price cap and lower international LNG prices had resulted in a significant drop in domestic gas prices.
While it was anticipated that there would be sufficient gas supply on the East Coast in 2024, forecasts indicated that the southern states could face significant shortages from 2027. The ACCC emphasized the need for additional gas supply and infrastructure in the coming years to meet growing energy demands and support Australia’s transition to a renewable energy system. At the same time, the opposition criticized the Labor government’s policy of aggressively transitioning to renewable energy, blaming it for increased electricity and gas prices.