Viva Energy (ASX:VEA) A$2.53 trading halt lifts as Geelong fire cuts 10% of Australia’s fuel

Viva Energy Halt Ends After Geelong Refinery Fire

Viva Energy (ASX:VEA) shares returned to trade this morning after four days in a halt, following the big fire at its Geelong refinery on the night of 15 April. The stock was frozen at A$2.53, having been up more than 20% for the year before the incident. Geelong is not just any asset. It supplies about half of Victoria’s fuel and around 10% of Australia’s total. In our view, this is far bigger than a VEA story. It is a real test of how stretched Australia’s refining setup has become, with clear flow-on effects for Ampol (ASX:ALD) and the wider energy sector.

What the Geelong Damage Means

In its Monday update to the ASX, Viva Energy confirmed the fire was contained to the Alkylation Unit, with the key crude distillation and reformer units unaffected. The Residue Catalytic Cracking Unit is temporarily offline for stabilisation, and the cause is still under investigation. Crucially, Viva Energy expects to restore diesel, jet fuel and petrol production to more than 90% of capacity in the coming weeks, pending inspection.

That is a meaningfully better outcome than Friday’s figures flagged by PM Anthony Albanese, who confirmed the refinery was running at 60% petrol, 80% diesel and 80% aviation fuel at that point. To bridge the gap in the meantime, the government has secured an extra 100 million litres from Brunei and Korea, with BP joining the Export Finance Australia import arrangement. Viva Energy has also notified insurers for both property and business interruption cover, which should soften the earnings hit.

Why the Fire Still Helps Ampol (ASX:ALD), Just Less Than It Looked

With Geelong running below normal, Ampol’s Lytton refinery in Brisbane is the only domestic refinery at full speed. And Ampol’s position is stronger than it looks. On 20 March, the company deferred its planned Lytton maintenance shutdown from early June to the start of August, a move that adds roughly 300 million litres of extra domestic petrol, diesel and jet fuel in that window. That means Lytton has clear air to run flat-out through the exact period Geelong is recovering.

The market has noticed. Ampol shares hit fresh 52-week highs on Thursday before settling around A$33.06 and are up roughly 60% over the past year. Tighter local supply should lift refining margins at Lytton and boost demand across its network. That said, Viva’s “over 90% in the coming weeks” guidance suggests the Ampol tailwind may be shorter than the market first assumed. Having one refinery carrying the country is also a single-point-of-failure risk, which tends to bring politicians to the table. We expect fuel security policy to return to the spotlight, which could mean stronger government support for both Viva Energy and Ampol over time.

The Investor’s Takeaway for Viva Energy

It helps to remember that refining is not Viva’s biggest profit engine. Its commercial and industrial business, along with its retail and convenience network, contributes more to group earnings. That softens the blow but does not cancel it.

The main risks, in our view, are the inspection taking longer than “coming weeks” implies, any gap in business interruption insurance cover, and tougher government rules on fuel security. Inspection delay is the one we would watch most closely.

For existing holders, Monday’s update is reassuring, and sitting tight looks reasonable. For new investors, waiting to confirm the inspection outcome before Viva Energy formally restores 90%+ capacity is the more disciplined approach.