Australia’s giant LNG exporters are set to enjoy a $27bn boost to their revenues due to the Middle East conflict, according to new government estimates already being used to push for higher gas taxes.
Despite being among the three biggest LNG exporters in the world, Australia collects relatively little tax compared to other resource-rich nations such as Norway and Qatar.
The Albanese government was under pressure to announce plans to lift taxes on gas exports, only to shelve the idea after the US and Israeli attacks on Iran.
Iranian missile attacks in March then shuttered Qatari gas facilities and – according to the latest quarterly energy and resources report – “flipped” the global market from too much LNG supply to too little. This sent world prices higher.
As a result, the Department of Industry, Science and Resources estimated Australia’s LNG export earnings for 2026–27 would be $67.6bn – $21bn above what was forecast in December.
The department also upgraded its export earnings estimates for the past financial year by $6bn and warned extended disruptions could add a further $7bn to LNG exports in 2026-27.
“Price pressures linked to the Middle East conflict are expected to largely ease by 2029, with prices then returning to levels broadly consistent with forecasts made in March 2025,” the report said.
David Pocock, the independent senator for the ACT, used the latest forecasts to double down on his demands for action on higher gas taxes.
“Our campaign for a gas tax isn’t going away and huge wartime revenue for gas companies again underscores how as Australians we are missing out on a fair return from the sale of our finite resources,” Pocock said in a statement.
Pocock said he had booked ads about the issue, targeting Labor’s national conference to be held in a few weeks.
“Time and again we’ve seen the Albanese government caving to vested interests, from gas to gambling, and it has to stop.”
Experts have said the current petroleum resource rental tax has failed to capture the huge windfall profits from mostly foreign-owned operators of the Queensland LNG export facilities.
Chris Richardson, an independent economist, has described the efforts to tax gas firms as a “bipartisan blooper” and an “epic fail”.
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Josh Runciman, an analyst at the Institute for Energy Economics and Financial Analysis, said Australia was living through its second global gas supply crunch in five years.
But unlike the experience in 2022 following Russia’s invasion of Ukraine, Runciman said domestic prices had not followed overseas prices higher – in no small part thanks to government intervention in the local market, including the looming gas reservation scheme.
“We know that the existing state and federal taxes don’t do a good enough job capturing windfall profits that occur when things happen overseas,” he said.
While he backed reforms that would deliver a better deal for Australians, he said the flat 25% export tax pushed by some, including Pocock, was “not the right model”.
Instead, he favoured an expanded version of Queensland’s tiered royalty system at the federal level.
“The current higher prices and the revision of export earnings is likely to continue to put pressure on the government to do something about taxes,” he said.
Runciman said global fossil fuel supplies were vulnerable to further disruptions, even assuming the current Middle East conflict is resolved over coming months.
“We’ll probably see more periods where Australian LNG exporters earn windfall profits again, and without any reform we may see situations like this, where taxpayers continue to not earn much return on the gas.”
