Global oil giant BP on Wednesday announced it will close one of its two Australian refineries with the loss of 355 jobs, citing growing competition from Asia.

The Bulwer Island refinery, near Brisbane, had moved to producing low sulfur fuels in recent times to be more competitive, but the business environment had changed, BP Australasia president Andy Holmes said at a televised press conference in Melbourne.

"The emergence of very large, modern, export-based refineries in Asia that can operate on a much lower cost base has transformed the industry and presented the Bulwer operation with an insurmountable challenge," said Holmes.

"The market reality is that global refinement capacity is shifting to service the energy growth areas of the globe and it's doing so with very large export-based refineries that, fortunately for Australia, are based in our region."

He said the closure in mid 2015 would have no effect on wholesale or retail fuel prices nor would it harm Australia's energy security.

"Australia is well served by diverse, regionally integrated and reliable supply chains," said Holmes.

"We know from experience that these supply chains have effectively and efficiently delivered competitively priced fuels to customers through disruptions and through the demand growth that we've experienced both domestically and in China."

Holmes said BP's last remaining Australian refinery in Perth had a safe future so long as it continued to be competitive and improved its efficiency.

Energy security expert Dr. Vlado Vivoda, of Griffith University in Queensland, told ABC News that Australia's refining capacity had halved in recent years and would continue to diminish.

"Our supplies are essentially subject to the security of supply lines that bring petroleum products from international markets, particularly from Singapore, which we are becoming increasingly reliant on," he said.

"An event at a particular refinery in Singapore could have significant ramifications on our refined petroleum product supplies in Australia."