Its purpose, ‘to ensure that a self-sufficient security reserve is established by the end of the year, in anticipation of a potential fuel shortage resulting from the prolonged conflict in the Middle East,” the government said.

Dili’s decision come as the US-Israel war against Iran has effectively shut down the Strait of Hormuz, a strategic Gulf waterway through which about 20 percent of the world’s oil supplies pass.

In earlier decisions on 25 March, also announced in a government press release, Dili approved temporary measures to control fuel prices and protect households. These include setting maximum prices, such as $1.50 per litre for petrol and $1.65 for diesel.

Dili officials have warned that rising global fuel costs may still affect daily life. People may see higher transport fares, more expensive electricity, and rising food prices as delivery costs increase.

Prime Minister Xanana Gusmão has said that, if the situation worsens, the government may need to reduce electricity use at night to save fuel.

The government says these steps are designed to protect the country and reduce the impact of rising costs on families and businesses.