(Image: Private Media)

While the Australian government has so far offered around $60 million in humanitarian aid to Ukraine, and another $90-odd million in military assistance, we can afford to do a lot more.

Why? Because we’re one of the biggest beneficiaries of Russia’s invasion. The latest government quarterly energy and resources report shows exports of fossil fuels are expected to reach a record $425 billion this financial year — a 32% rise from 2020-21. The increase is purely the result of price rises.

Australia’s exports are still dominated by iron ore but gas (expected to more than double to $70 billion in exports) and coal (expected to also more than double to nearly $110 billion) are reaching unprecedented levels, with coal driven both by rises in metallurgical and thermal coal.

The surge in gas revenue is due to the forecast price rising to $US16 per gigajoule. That’s about $US12 per metric million British thermal units (MMBtu) — and Asian spot LNG prices have been above this level since the start of the financial year, reaching a record $US48.30 per MMBtu in late December.

The remarkable surge in coal revenue — iron ore has been the only export to ever earn more than $A100 billion in export income in a year — is driven by an expected price for metallurgical coal of $US348 a tonne, up from $US123 in 2020-21. Again, this could be conservative: futures prices have coal prices well above $US400 a tonne for Australian coal from central Queensland. No wonder Resources Minister Keith Pitt leaked the report to News Corp ahead of its official release.

Australia is the world’s largest exporter of metallurgical coal, but Russia is also a significant exporter, supplying about 30% of Europe’s needs. If Europe — either at government instigation or because corporations fear the taint of links with war criminals — rejects Russian coal, an already tight seaborne market is going to face further challenges and see prices soar even further — Chinese, Japanese and South Korean steelmakers will not want to be priced out of the market.

Russia is also a major exporter of thermal coal. Thermal coal prices have also surged, with the Australian benchmark Newcastle Weekly Index hitting an all-time high of around $US436 a tonne in mid-March, before declining to $262 this month. But even after that fall, thermal coal prices remain well above the government’s forecast of $US193 a tonne for the 2021-22 year.

The windfall in export earnings — achieved with little in the way of increased cost for exporters — accounts for most of the 9% rise in forecast company tax revenue the government reported in the budget, and the 18% rise in petroleum resource rent tax (PRRT) receipts, albeit only to a still-trivial $1.65 billion (we should be earning tens of billions from our gas exports, not sums measured in the hundreds of millions).

Together, that is expected to pour an extra $9 billion into government coffers compared to estimates just five months ago in the Mid-Year Economic and Fiscal Outlook (MYEFO). Against that, the government is forfeiting around $2.5 billion in net terms for its silly decision to cut fuel excise because of the surging oil price (the report predicts oil will average $US92 a barrel, up from $US54 a barrel).

But this is the dirty little secret of the government’s election bribes: they’ve been funded with the help of the suffering of Ukraine and the global spike in energy prices that has delivered big windfalls for energy exporters like Australia — and had real consequences for energy importing states.

Australia could give Ukraine 10 times the help we’ve already given them and still give ourselves some election bribes — or maybe actually use the windfall to reduce the still-massive budget deficit. But as Paul Keating could have said, never get between a politician and a bucket of money.