The Bureau of Meteorology says there’s three times the normal chance of an El Nino developing this year, while drier than usual conditions associated with rising bushfire risk are already expected to persist over the next few months. 

“Ocean temperatures have recently warmed to El Nino levels, but a confirmed shift in the tropical atmosphere is also needed before announcing an El Nino event,” the bureau said in an update last week.  

The Bureau earlier this month shifted the dial from an El Nino Watch to an Alert, indicating a 70% chance of an event forming this year, following the end of three consecutive flood-causing La Nina events. 

El Ninos are typically associated with reduced rainfall, warmer temperatures, fewer tropical cyclones and increased fire danger in southeast Australia. 

Weather conditions have already changed, with May average rainfall below average for most of Australia and the bureau expecting drier than average conditions to persist through winter and into spring.  

Aon says Australia may be entering a more inactive natural catastrophe period and face lower industry losses in the years ahead as climate patterns transition from La Nina to El Nino. 

Changes could lead to a longer-term shift in the underlying ocean circulation, known as the Pacific Decadal Variability, with a moderate El Nino event in the 2023-2025 period potentially flipping the PDV to an El Nino-like phase for the ensuing decade, it says. 

“After three years of back-to-back La Ninas, the concern is fuel growth and the preconditioning of the landscape for bushfire,” Aon senior analyst Tom Mortlock said. “The historical loss record shows us that bushfire losses are correlated to periods of El Nino, albeit to a lesser extent than floods and cyclones are to La Nina. 

“El Nino years have typically led to lower total insured loss years in Australia than La Nina years, and while floods and cyclones do occur during El Nino, they are less likely.”