PETER STEFANOVIC: Joining us live now from Sydney is the Energy Minister, Angus Taylor. Minister, good to see you. Thanks so much for joining us. So what will this do in terms of an increase of supply? What is the new minimum?

ANGUS TAYLOR: Well, it'll be different by fuel source, but the critical point here is that we're making sure there's enough fuel supply for extenuating circumstances. The particular focus of the storage package and the minimum mandatory obligation is diesel, Pete, because in extenuating circumstances it's diesel you need most. You need it to keep your farmers going, to keep your transport going, your truckies, your mines - all those essential services. So there's a particular focus on diesel. This will set a mandatory minimum obligation for diesel which is 40 per cent above the level we typically see now. But it will also shore up our refineries, and our refineries are crucial because they can process our local crude oil and that puts us in a position where if we can't import, we've still got a significant supply available for those absolutely essential services. The good news about all of this is we've done it in a way which will add supply, add competition and put downward pressure on prices and that's crucial - not adding cost here to commuters, ensuring that commuters get a good deal, and supplies are there in extenuating circumstances without price spikes.

PETER STEFANOVIC: So when you talk about it, and when we talk about the minimum being some 90-odd days, or about 90 days of total fuel supply that we need, that's encompassing all different forms of fuel, isn't it? Or is that just-

ANGUS TAYLOR: That's correct.

PETER STEFANOVIC: Yeah.

ANGUS TAYLOR: So that's diesel.

PETER STEFANOVIC: Right.

ANGUS TAYLOR: Avgas, jet fuel for aeroplanes, gasoline.

PETER STEFANOVIC: Yeah.

ANGUS TAYLOR: But also crude oil. Crude oil is crucial in this because we do produce quite a lot of it here in Australia, mostly out of, a lot of it at a Bass Strait, Cooper Basin, and crude oil plays a crucial role in this, but that means we've got to have refineries to process it.

PETER STEFANOVIC: Yeah.

ANGUS TAYLOR: And that's why part of this package is shoring up those refineries, and making sure we have control over our own destiny.

PETER STEFANOVIC: Well, you talked about extenuating circumstances, just in your first answer there, Minister, I mean I think we can tell what that is. But can you elaborate on what those circumstances are?

ANGUS TAYLOR: Well the worst possible circumstances is when we're not able to import fuel. Now, that's a pretty extreme scenario. We’ve never been put in that scenario-

PETER STEFANOVIC: Because of war?

ANGUS TAYLOR: Well, obviously it would be a strategic situation of some description. But the point about this is that if you've got crude oil and refineries then you can get an essential supply to those critical industries like transport, like our farmers so that we can eat. All of those things. So you know, the refineries are a crucial part of this but we've also got to have strong local storage, and that's why we're investing $200 million, an extra 800 million litres of fuel which is a very significant increase, as I say, with a particular focus on diesel.

PETER STEFANOVIC: Is China on your mind when it comes to these extra investments?

ANGUS TAYLOR: It doesn't matter what the source of the strategic intervention is - I mean it could be many different sources. So you know, this is neutral to that particular cause. What matters is it has to, we have to be in a position where we can actually deal with it, Pete, and that's exactly what this is about.

PETER STEFANOVIC: Yep.

ANGUS TAYLOR: And doing it in a way which doesn't impact consumers at the bowser, and this is so crucial to this package - making sure we get the balance right, extra supply, extra competition but extra reliability and control over our own destiny in extenuating circumstances.

PETER STEFANOVIC: Okay. Well let's just say that there is some kind of conflict - it might be far off down the track - but let's say there is some kind of conflict in the South China Sea. Is there a strategy for ensuring the safe delivery of that fuel?

ANGUS TAYLOR: Yes. Making sure we have enough refining capacity, making sure we have enough storage, and having a particular focus on essential industries and essential fuel supplies. As I said, diesel is critical to that. Now, we've seen this during coronavirus, and it's interesting, whilst very different circumstances, we can learn a lot from it. We've seen the demand for aviation fuel obviously collapse because planes are not flying for the most part. We've seen demand for petrol come down very significantly. But demand for diesel has remained strong. And that's the point, those essential services, your truckies we all see out there on the road, of course your farmers, they keep going, they keep going and that's why this strategy, this plan, this package is all about making sure that supply is there for our essential services.

PETER STEFANOVIC: Okay. Energy Minister, Angus Taylor, appreciate your time as always. Thanks for joining us here.

ANGUS TAYLOR: Thanks for having me.