Prime Minister Anthony Albanese has asked Australia’s Treasury to look into imposing a windfall tax on the country’s vast liquefied natural gas industry, to capitalize on soaring prices of the fuel.
The request for modeling was confirmed by Energy Minister Chris Bowen at a press conference on Friday, though he did not provide further details as it is a confidential cabinet process. The Australian Broadcasting Corp. reported the modeling request earlier the same day.
Global prices of LNG have surged due to supply disruptions caused by the war in the Middle East. The critical Ras Laffan LNG hub in Qatar, which provides about a fifth of global exports, sustained extensive damage in an Iranian missile attack this week and may take years to repair. Meanwhile, cargoes remain trapped as the Strait of Hormuz remains effectively closed.
Australia was the world’s third-largest LNG exporter last year, shipping nearly 80 million tons worth A$65 billion ($46 billion) in the year through June 2025, mainly to Japan, South Korea and China. The oil and gas industry paid about A$22 billion in taxes and royalties over 2024 to 2025, according to industry lobby, Australian Energy Producers.
The group warned that higher taxes would deter investment in new gas supply, lead to shortfalls in the domestic market, and inflict pain on households at a time when inflation is already high.
Imposing a windfall tax would “leave Australia more exposed to future energy shocks,” said Samantha McCulloch, the lobby’s chief executive officer. “While international gas prices have surged, Australian gas prices remain relatively low, and the market is well-supplied.”
In Europe, Germany’s Finance Ministry is also considering a windfall tax on energy companies to capture a share of higher profits driven by the war. Authorities are examining an excess-profit levy to fund consumer relief, a government official said on condition of anonymity.
Meanwhile, the UK has backtracked on plans to scrap its controversial windfall tax on offshore oil and gas producers due to the war.
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