"We don't need or want it," Energy Minister Chris Bowen says.
His hard line follows reports US President Donald Trump has struck a deal with Moscow to supply the heavier refined petroleum product typically used in trucking and agriculture.
The apparent agreement with Vladimir Putin comes despite Washington's long-term efforts to persuade him to end Russia's war with Ukraine.Â
Mr Trump has taken to social media to tout "highly successful" talks which will immediately deliver 300,000 tonnes of diesel to US and global markets.
More and larger amounts would be supplied in coming months, Mr Trump said.
However, Australia won't be taking up any potential offer, Mr Bowen told reporters on Saturday.
"We have the arrangements in place as best as we possibly can with our trading partners to ensure Russian fuel doesn't flow to Australia," he said.
"That policy is not changing, will not change."
What the US decided would be "a matter for them", Mr Bowen said.
"We'll continue to have the very, very firm view that Russia should not be rewarded for their illegal and immoral invasion of Ukraine by any arrangements put in place as a result of the Middle East crisis."
Australia's fuel price pain, triggered by the outbreak of war in Iran, has persisted since February.
According to PetrolPulse data, the national average price of diesel is slightly more than $2.83 per litre.
As of Friday, Unleaded 91 across Australia's capital cities sat on average at $2.43 per litre, up about five cents from last week.
"We'll continue the same approach we've had all through this crisis, working closely with trading partners ... and working very closely with our domestic refiners to ensure they are working at full pelt," Mr Bowen said.
Australia has 43 days' worth of petrol, or two days more than last week, 31 days of diesel, or one day less than last week, and 30 days of jet fuel.
There are 51 supply ships on the way to Australia and 3.2 billion litres of various types of fuel locked in and contracted for delivery over the next four weeks.
"I think it gives Australians reassurance in a difficult period that we continue to have the fuel we need," Mr Bowen said.
"The situation internationally remains difficult."
10°C