Extraordinary diesel price increases are delivering direct and material cost impacts across Australia’s road construction and maintenance sector.

The Australian Flexible Pavement Association (AfPA) has issued a second industry statement addressing the severe diesel fuel cost escalation now affecting flexible pavement delivery nationally. Australian Institute of Petroleum data confirms diesel prices have risen in excess of 60 per cent since the commencement of the conflict arising from the closure of the Strait of Hormuz, with national average retail diesel approaching $3.00 per litre. This increase elevates the cost of asphalt manufacturing, material haulage, and on-site construction across every road program in Australia.

AfPA’s statement covers the following key areas:

• The current diesel cost position and its impact on asphalt production, haulage, and construction plant
• The gap in current contract settings where diesel is not covered by standard rise-and-fall provisions
• AfPA’s proposed fuel cost recovery mechanism, benchmarked to the AIP Diesel Terminal Gate Price
• The established precedent from Queensland TMR’s Annexure E framework
• AfPA’s call on state and territory road authorities to adopt fair and transparent fuel cost adjustment mechanism
• Road construction and maintenance as essential infrastructure — connecting communities to food, farms, essential services, and each other

AfPA has written to the directors general and chief engineers of all state and territory road authorities and to the newly appointed national Fuel Supply Taskforce Coordinator to advance these measures. The AfPA Fuel Cost Escalation Calculator is available to members through their state and territory branches.

[Download the full AfPA Industry Statement — Diesel Fuel Cost Escalation — March 2026]

This statement follows AfPA’s Industry Statement of 12 March 2026 on the global bitumen supply chain disruption. AfPA monitors the situation closely and will publish further updates as conditions develop. Members and stakeholders are welcome to contact AfPA directly for further information.