The construction industry is on high alert as rising fuel prices evoke memories of the COVID-19 pandemic, when supply chain disruptions led to skyrocketing costs.

The recent conflict in the Middle East, sparked by U.S. and Israeli military actions against Iran and resulting counterattacks, is raising fears of fuel shortages and their impact on industries that heavily depend on fuel.

Denita Wawn, CEO of Master Builders Australia, expressed the growing concerns over increasing expenses in the building and construction sector.

“We are receiving a flood of notifications from building suppliers informing us of increased transport costs due to fuel surcharge levies,” Wawn shared with SBS News.

“Our industry is deeply dependent on diesel, whether it’s for civil construction projects or the countless utility vehicles crisscrossing our cities and rural areas daily to reach various construction sites.”

She said while developers learned to be more conservative in their forecasts following COVID-19, long approval lead times of six to 24 months before a project start mean these additional costs could not have been factored in.

Wawn is urging the government to step in early and consider a fuel carve-out for the building and construction industry.

“It is critical that essential services like building and construction continue,” she said.

“And if that means that fuel rationing has to occur for the betterment of the country as a whole, so be it. Building and construction has to be included.”

Prime Minister Anthony Albanese has not suggested fuel rationing or carve-outs for particular industries to date, instead urging calm.

On Thursday, Albanese reassured Australians that fuel deliveries have not yet been disrupted and established a fuel taskforce to coordinate state and Commonwealth distribution efforts around the country.

“Our fuel supply is currently secure. However, I want us to be overprepared,” he said.

Energy Minister Chris Bowen revealed that 519 million litres of petrol and diesel have been released from the country’s emergency reserves and directed to regional Australia.

He reiterated government calls for people not to panic-buy fuel, explaining it puts strain on the supply chain, which is already adapting to changing international circumstances.

“If demand is double, the supply chain will struggle,” Bowen told ABC RN on Friday morning.

Government’s new homes target at risk

Wawn stressed that transport and material cost increases and disruptions to the building supply chain will hinder efforts to meet the National Housing Accord target of 1.2 million homes before the end of the decade.

“Higher costs for builders will harm productivity and affordability at a time when we need a dramatic increase in housing supply,” Wawn said.

“Since the start of the Accord, a 75,000-home backlog has already accumulated. Unless the federal government pulls the correct policy levers, recent events are likely to worsen the home building situation even further.”

Earlier this week, the Urban Development Institute of Australia released its annual State of the Land report, examining residential development activity across Australia.

It forecasts a shortfall of 380,000 new dwellings by 2030, and a production drop of 11 per cent in 2026 alone, due to rising costs, labour shortages and volatility in the construction industry.

Opposition housing spokesperson Andrew Bragg says the industry has been “bogged down” by high labour and material costs for years.

“Construction costs and labour shortages were already biting before any conflict in the Middle East disrupted global supply chains,” he told SBS News.

“This has only been made worse by the current oil crisis.”

He pointed to 3,596 building industry insolvencies in 2025, according to the Australian Securities and Investments Commission, as demonstrating the “fragility” of the sector.

“Builders and developers are being forced to operate in a system that is increasingly costly and difficult,” he said.

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Aziza Ahmad finds herself without plans for Eid al-Fitr this year. With no family gatherings or gifts for the children, her heart is heavy. “There’s nothing to celebrate,” she says, as the ongoing conflict in Lebanon and the soaring cost of living overshadow the festivities marking the end of Ramadan.

Across the Middle East, from the bustling streets of Beirut to the glittering skyline of Dubai, and from the cultural hubs of Manama to the historic lanes of Jerusalem, the conclusion of the holy month of fasting brings little solace. For millions of Muslims, the joy of Eid is marred by the unrelenting turmoil and instability in the region.

In her modest Beirut apartment, Ahmad, 49, shares a cramped space with her husband, three sons, and nine other relatives. The small home has become a refuge for 12 people, all trying to make do with limited resources.

“Perhaps the wealthy are celebrating, but for us, the essence of Eid has vanished. We have no money, and those who have been displaced have no place to return to,” Ahmad laments.

In Lebanon, the economic crisis has been a constant for years, exacerbated now by conflict. Prices in local markets have surged, leaving many struggling to afford basic necessities.

On the eve of Eid, Ahmad set up a small pastry stall in front of her home to supplement her husband’s salary as a car washer.

“We won’t eat a single one; everything is for sale,” she said.

Kneading dough and crushing pistachios, the whole family was busy in the building’s entryway.

“We won’t even go out to play. Everyone is scared, Israel is striking, so we stay home,” said Yasmine, 11, a big pink ribbon in her hair.

Disruptions to life across the Gulf

In the Gulf, fear of bombings has also dampened the mood.

Long seen as the region’s safe havens, these countries have been the target of Iran’s retaliatory strikes following US-Israeli attacks on Iran from 28 February.

Nearly 30 people have been killed in Gulf states since the war broke out.

In Kuwait, authorities have temporarily banned plays, concerts and weddings during Eid al-Fitr to limit large gatherings.

Ali Ibrahim, a 41-year-old Egyptian working in Kuwait, said fewer customers than usual have turned up at stores to buy new clothes ahead of Eid.

Qatar also suspended all public events until further notice from the start of the conflict.

In the United Arab Emirates, outdoor prayers are banned for Eid and must be held inside mosques for security reasons.

Juhi Yasmeen Khan, a 53-year-old social worker from India who has lived in Dubai for nearly three decades, said “it doesn’t feel right to have a grand celebration” this year.

“Given the current situation, many of us are opting for intimate celebrations at home,” she said, adding that she would celebrate with her mother, sister and son.

“Together, we will keep the Eid spirit alive.”

‘This will surely pass’

For Palestinians in occupied East Jerusalem, Ramadan is incomplete this year after Israel shut Al-Aqsa Mosque, among other holy sites, over the ongoing war.

“There is a pain in our hearts because we are deprived of Al-Aqsa Mosque,” said Ihab, a 30-year-old who declined to share his last name.

This year, the lights and lanterns featuring Islamic designs, such as crescent moons, are absent from the streets.

The narrow passages of the usually bustling Old City emptied at the start of the conflict.

In Bahrain, people have been living to the sound of sirens ringing several times a day to warn of potential missile and drone threats.

At a beauty salon in the capital Manama, five-year-old Sarah waited to have her hands painted with henna ahead of Eid celebrations.

Her mother Maryam Abdullah said the war will not stop her family “from buying our Eid necessities and preparing for the holiday as we always have”.

“This will surely pass, and it won’t prevent us from enjoying the Eid atmosphere, even if it’s limited to visiting family at home,” she said.

Hessa Ahmed, a Bahraini employee in her thirties, was also intent on celebrating.

“I went shopping with my friend. We bought clothes and accessories and will prepare to celebrate Eid with family, relatives, and friends.”

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