The dire warning comes at a time when more than 90 per cent of all fuel consumed in Australia is imported, according to the report released by think tank The Australia Institute on Thursday.
Researchers say the country only has 68 days of reserves, even though the International Energy Agency stipulates 90 days.
But it gets worse, because average daily consumption over the last year means current stocks are only expected to last 32 days.
The refined fuels and crude oil to meet Australian consumption comes from Singapore, South Korea, China and Japan.
Independent Warringah MP Zali Steggall blamed the federal government for subsidising the fuel industry at the expense of renewable energy.
"We have only a handful days of supply and we're incredibly exposed," she told reporters at a Sydney clean energy forum where the report was launched.
Ms Steggall noted oil costs consumers $29 billion a year and called for a 60 per cent cut to carbon emissions by 2030.
Richie Merzian of The Australia Institute described the current reliance on imported fuel as a national security problem.
Pointing to the ongoing conflict in Ukraine, he noted Australia was ill-prepared to deal with international disruptions.
"High petrol prices are already hurting Australians. The only long-term solution is getting off oil," said Mr Merzian.
He suggested more investments and incentives for consumers to buy electric vehicles.
Current sales of electric vehicles stand at one per cent of the whole automotive market.
North Sydney independent candidate Kylea Tink, who is contesting the May 21 federal election in North Sydney, also wants a rethink of the transport industry.
"We are driving some of the least efficient vehicles in the world with some of the dirtiest fuel in the world," she said.
Mrs Tink explained that drivers would have saved $500 a year filling up their cars if the federal government had implemented vehicle emissions standards recommended by the Productivity Commission in 2016.
Former Australian Defence Forces chief Chris Barrie lambasted the federal government over its ability to manage natural disasters caused by climate change, pointing to the floods in recent months and the bushfires in 2019-2020.
"Australia has no credible climate policy, leaving our nation unprepared for continuing climate change impacts," he said.
"We're a pariah country because of the manifest failure of our leadership."
He said successive governments had engaged in "obfuscation, deception and denial" when it came to climate change and called on voters to look to independents to help move the agenda along.
"I've counted this as the most important election in my lifetime because in 2025 we will not have the opportunity to save ourselves from dire (global warming) consequences," he said.
Allegra Spender, independent candidate for the affluent electorate of Wentworth, also supported weaning off fuel supplies.
"Electric vehicles have the opportunity over the short and medium term to be cheaper for people," she told AAP.
"This is a cost of living issue as well as a security and environmental issue.
"Canberra is letting us down and we absolutely need to change that. This election is incredibly crucial."
Fuel security has decreased over the last decade with only two Australian refineries in operation after five shut down.
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