The IEA Just Told the World to Work From Home. Australia Hasn't Got the Memo

On Friday morning, the International Energy Agency released a 10-point emergency demand plan that reads like something from the 1970s oil shocks: work from home, reduce highway speeds by 10km/h, limit city car access through odd-even number plate schemes. The agency stopped short of using the word rationing. The effect would be roughly the same.

In Bangkok, news anchors ditched their jackets on air after the government asked citizens to cut air conditioning. In Manila, public sector workers shifted to a four-day week. In Seoul, regulators introduced oil price caps for the first time in three decades. Vietnam has asked Japan and South Korea for help securing crude imports.

In Canberra, we got a taskforce.

What the IEA actually recommended

The full list of emergency measures covers road transport, aviation, cooking fuels, and industrial feedstocks. It includes encouraging public transport, increasing carpooling, optimising commercial vehicle loads, diverting LPG from transport to cooking, and helping industrial facilities switch petrochemical feedstocks to free up supply. These are the kinds of measures IEA member countries are legally required to have ready for emergencies.

Australia is an IEA member.

In addition to this, today's report provides a menu of immediate and concrete measures that can be taken on the demand side by governments, businesses and households to shelter consumers from the impacts of this crisis.

— Fatih Birol, IEA Executive Director

The agency has been explicit about the scale of the problem. The closure of the Strait of Hormuz represents the largest supply disruption in the history of the global oil market. Last week, the IEA ordered the release of 400 million barrels from strategic stockpiles, the biggest coordinated draw in its history. Birol warned that if the Iran conflict continues, the impacts on energy markets and economies are set to become more and more severe.

The view from Asia

The response across the region has been fast and concrete. Thailand's government has suspended overseas trips for bureaucrats, instructed officials to wear short-sleeved shirts to reduce air conditioning demand, and increased biofuel blending ratios from 5% to 7%. Diesel subsidies are costing the Thai government more than 1 billion baht per day.

The Philippines depends on the Gulf for 90% of its oil requirements. President Ferdinand Marcos Jr told parliament that Filipinos are victims of a war not of their choosing, before announcing government agencies must cut fuel and electricity use by 10 to 20 percent. Cash handouts are being distributed to jeepney drivers, the backbone of the country's public transport system.

Indonesia is accelerating its biodiesel programme, blending 50% palm-oil-based diesel with conventional fuel. South Korea has introduced oil price caps. Japan has tapped its national oil reserves. Cambodia is now importing fuel from Malaysia and Singapore because Vietnam and China have restricted supplies.

This is the pattern across the region: demand-side measures, price controls, alternative fuels, domestic supply prioritisation. The common thread is speed. When your economy imports energy and the main shipping lane has just closed, you do not appoint a taskforce.

Australia's supply chain exposure

Here is the problem Australian officials do not like discussing in public: we import roughly 90% of our fuel, mostly as refined product from South Korea, Singapore, Malaysia, and Taiwan. We maintain approximately 26 days of diesel reserves and 29 days of petrol capacity, figures that fall below IEA minimum standards.

The concern now is that our top suppliers will cut exports to shore up their own reserves. When countries face domestic shortages, export commitments tend to become negotiable. Singapore's officials noted this week that national petrol and diesel reserves would last nearly six weeks, but warned that any disruption to fresh supplies could severely affect the island nation. That is Singapore calculating its own exposure. Australia's supplies come second.

Energy Minister Chris Bowen has released 20% of the nation's fuel reserves. State governments have held crisis talks with fuel suppliers. Regional and independent petrol stations have reported difficulty accessing fuel after suppliers prioritised regular customers over spot buyers. Some rural service stations simply cannot replenish their stocks quickly enough.

The federal response has focused on supply-side measures: relaxing fuel standards, investigating alleged anti-competitive behaviour by major retailers, establishing a national fuel supply taskforce. These are reasonable steps. They are also insufficient if the physical supply from Asia stops arriving.

Why demand measures matter

The gap between IEA recommendations and Australian action is worth examining. When the IEA suggests work from home policies, reduced speed limits, and number-plate access schemes, it is offering measures that can cut fuel demand by 5 to 10 percent within days. These are emergency tools designed for exactly this scenario.

State governments have been reluctant to discuss contingency plans such as fuel rationing. The political calculation is obvious: nobody wants to be the premier who told commuters they cannot drive on Tuesdays. But the alternative is waiting until pumps run dry and improvising under pressure.

Consider the maths. If work-from-home policies removed even 5% of commuting, that would extend Australia's diesel reserves by roughly 1.3 days. Speed limit reductions on highways cut fuel consumption by approximately 3% per 10km/h reduction. Number-plate rotation schemes, where odd-numbered plates drive on alternate days, halve personal vehicle demand. These are not marginal interventions. They are the difference between managing a crisis and being overwhelmed by one.

The IEA implemented exactly these measures across member countries during the 1973 oil shock, when Arab producers embargoed exports to the West. Speed limits on US highways dropped to 55 miles per hour. European countries imposed Sunday driving bans. The measures worked because governments acted before shortages became acute.

Wood Mackenzie analysts have warned that a prolonged disruption in the Strait of Hormuz could send oil prices to US$200 per barrel. The IEA reserves release does not change that picture. Strategic stocks buy time. They do not solve a supply problem that could last months.

What Asia understands that Australia does not

Governments across Southeast Asia moved quickly because they understand their vulnerability. Thailand, the Philippines, and Vietnam are large net importers dependent on Middle East supplies. They have introduced temporary subsidies and price caps, knowing these measures are difficult to sustain beyond one to two months. The urgency is real.

Japan has strategic reserves and the ability to release them. South Korea has capped prices and is shifting electricity generation toward coal and nuclear. Malaysia and Brunei, as oil producers, face different pressures but have suspended most exports. Even China is restricting supply to neighbours.

The speed of response matters because energy crises compound quickly. Panic buying depletes inventories. Hoarding removes supply from circulation. Price spikes trigger inflation expectations that become self-fulfilling. Governments that move slowly find themselves responding to yesterday's crisis while tomorrow's is already forming.

The common factor is that these governments are acting as if the crisis will last. They are managing demand because supply is genuinely constrained. They are not waiting for markets to sort themselves out.

Australia's position is that we have taskforces, we have reserve releases, we have investigations into fuel retailers. What we do not have, yet, is any public discussion of what happens if our Asian suppliers decide their own citizens come first.

The next few weeks

The IEA has made clear that further reserve releases are possible. Birol noted that the current draw will only reduce IEA reserves by 20%, leaving over 1.4 billion barrels available. This is meant to reassure markets. It also acknowledges that the agency expects the crisis to continue.

For Australia, the relevant question is whether Canberra will implement any of the demand-side measures the IEA has recommended, or whether we will continue treating this as a supply-chain logistics problem until it becomes something worse.

The view from Tokyo, Seoul, and Singapore is that governments need to act now, visibly and quickly, to demonstrate they take the crisis seriously. Price caps send signals. Work-from-home mandates reduce consumption. Four-day government workweeks create immediate savings.

The view from Canberra, so far, is that we have created a taskforce. The former head of the energy regulator will lead it. This is sensible, administrative, and entirely within the supply-side playbook that has characterised Australia's response from the start.

Asian markets are not waiting to see whether that approach works. They are already rationing.