Energy security has climbed to the top of policy agendas worldwide, driven by disruptions such as the closure of the Strait of Hormuz, the rapid shift to low-carbon technologies and surging power demand from AI data centers. Those pressures are especially severe across Asia and the Pacific, where many countries depend heavily on imported fuels.
Australia sits at a strategic crossroads: it is endowed with large fossil-fuel exports today and abundant renewable resources for tomorrow. That combination gives Australia a chance to shape regional energy markets — stabilizing short-term supplies while building the clean-energy trade that will underpin the Indo-Pacific transition.
Immediate priorities: secure supplies
The recent regional shock caused by hostilities that disrupted flows through the Strait of Hormuz exposed how vulnerable Asia and Pacific island states are to sudden supply interruptions. When flows were halted, significant portions of Asia’s oil and gas imports were temporarily lost, with consequential impacts on economies that rely on diesel for power and transport.
In the near term, the most practical contribution Australia can make is reliable delivery of liquefied natural gas (LNG) to Asia. Ensuring dependable supplies through commercial contracts and coordinated contingency planning would reduce the risk of disruptive price spikes and shortages.
A longer-term role: green exports and supply chains
Beyond LNG, Australia can position itself as a supplier of the low‑carbon inputs that will define future energy relationships: renewable fuels, hydrogen derivatives, battery minerals and processed materials for clean technologies. Those green exports — from lithium and other critical minerals to renewable hydrogen and low‑carbon ammonia — can become the backbone of a lasting energy partnership with Asian economies.
A strategic alliance
To make this transition durable, Australia should pursue a coordinated regional energy-security strategy with like-minded partners such as the United States, Japan and other allies. That alliance would aim to stabilize markets in the short term and to accelerate the build-out of clean-energy industries across the Indo-Pacific.
Crucially, this should be a comprehensive approach covering the entire energy supply chain: critical minerals and refining capacity, gas and diesel where needed, hydrogen and battery manufacturing, financing and shipping infrastructure, data centers and industrial applications such as low-carbon fertilizers. Incorporating the clean-energy transition into the alliance’s architecture will avoid locking the region into fossil-fuel dependence while meeting immediate needs.
Why Australia is well placed
Australia is currently the most reliable high-volume LNG supplier in the region. Competitors face constraints: some exporters are subject to sanctions or geopolitical risk, while others face longer transit times to Asia. Australia’s proximity, export capacity and abundant critical-mineral resources give it a comparative advantage both in fossil-fuel markets today and in supplying the raw materials for tomorrow’s clean industries.
Allied partners also have roles to play. The US and Canada remain major hydrocarbon producers and are expanding battery manufacturing capacity. Japan can provide financing, technical expertise and shipping infrastructure that smaller regional economies lack. Together, these partners can combine supply, capital and technology to backstop the Indo-Pacific’s energy needs while accelerating decarbonization.
Domestic hurdles to address
Australia must not be passive. Policy uncertainty, slow project approvals and shifting domestic energy rules have contributed to regional concerns — and even to looming gas tightness in parts of the country. These domestic constraints also slow investment in renewables and push up costs.
Fixing permitting and planning bottlenecks, clarifying export and domestic-supply policies, and aligning national objectives with regional responsibilities will be essential. That means balancing Australia’s 2050 net-zero target with pragmatic short-term arrangements that provide the region with secure fuel supplies until low-carbon alternatives are widely available.
A pragmatic pathway
Many Indo-Pacific countries will depend on fossil fuels beyond 2050 as they pursue their own transition timetables. If supply beyond 2050 is needed, it is preferable that it comes from reliable, transparent partners rather than states with higher geopolitical risk. By guaranteeing dependable LNG and accelerating the export of clean-energy inputs, Australia can be both a stabilizer today and a supplier of the technologies that will decarbonize the region.
Seizing this opportunity requires a clear, coordinated strategy: form a regional energy security alliance with trusted partners; design it to cover fossil fuels and the full clean-energy supply chain; and fix domestic regulatory and infrastructure barriers so Australia can deliver. With those elements in place, Australia can move from regional exporter to an enduring Indo-Pacific energy partner.
Robert Monterosso, Research Fellow, United States Studies Centre, University of Sydney
