The Australian Flexible Pavement Association (AfPA) says Australia’s road construction and maintenance sector has continued delivering critical programs despite one of the most severe input cost shocks in a generation.

According to AfPA, the Strait of Hormuz crisis in early 2026 exposed long-standing vulnerabilities in the way Australia manages fuel reserves, contracts, and bitumen specifications, but the sector kept roads moving across the country. Asphalt works on the Coffs Harbour Bypass continued, Bruce Highway upgrades progressed in Queensland, and North East Link in Victoria remained on schedule. Road repair crews mobilised for disaster recovery in Queensland, the Northern Territory, and Western Australia, even as diesel costs spiked and bitumen supply tightened.

AfPA CEO, Tony Aloisio, said the crisis highlighted structural gaps that had always existed. “The vulnerabilities were not created by the conflict in the Middle East. The crisis simply made them impossible to ignore,” he said.

AfPA identified three key issues. First, the organisation noted that Australia’s fuel reserve position has been deliberately lean. At the start of the Hormuz crisis, the country held roughly 34 days of diesel, below the International Energy Agency’s 90-day recommendation. AfPA says emergency reserves, a National Fuel Supply Taskforce, and direct supply agreements helped the industry cope, but the system relied on improvisation rather than preparedness.

Second, AfPA said standard road construction contracts were not designed to manage large diesel price spikes. While bitumen has rise-and-fall provisions, diesel is generally tendered at fixed rates. During the 78 per cent price increase over three weeks in March, AfPA noted that contractors absorbed extraordinary costs to maintain programs. The organisation highlighted the need for a national, consistent diesel escalation framework, implemented in stable conditions rather than negotiated under operational pressure.

Third, AfPA highlighted that Australia’s bitumen supply and specification framework lacks disruption protocols. The industry relies almost entirely on imported C-class bitumen under AS2008 standards. AfPA said that when international refineries cancelled commitments during the crisis, road authorities and contractors sourced alternative supplies quickly, maintaining delivery programs at significant cost.

AfPA said the sector showed resilience despite these structural gaps. Contractors, bitumen suppliers, and road authorities worked collaboratively, absorbing costs, sourcing alternative supplies, and keeping projects on track. AfPA coordinated industry engagement, ensuring concerns from smaller operators and major contractors were communicated to governments.

Tony Aloisio said, “The crisis proved that resilience built on individual competence and good faith is a strength, but not a substitute for fit-for-purpose policy and contracts.”

AfPA says the work ahead is focused on converting crisis responses into durable policies: updating contract frameworks, establishing technical protocols, and embedding clear mechanisms for fuel and bitumen supply disruptions. The organisation will continue providing an evidence-based voice to ensure the sector can respond to future shocks by design rather than improvisation.

AfPA’s industry statements and resources, including the Fuel Cost Escalation Calculator, are available at afpa.asn.au.