Diplomacy is better than a show of force to help stabilise security in the Middle East, the prime minister says amid calls for Australia to send a warship.
The federal government is mulling a US request to deploy a ship to the Red Sea to help secure international shipping lanes against Iran-backed Houthi rebels, who are enforcing a blockade they claim is in support of Palestine.
But Australia could contribute more effectively through diplomacy, Prime Minister Anthony Albanese said.
"We know that the US understands the best way for Australia to support this is through diplomatic support," he told reporters in Sydney on Wednesday.
"Our resources have been prioritised in our region, in the Indo-Pacific.
"We've played an important role in freedom of navigation in the South China Sea."
Mr Albanese again condemned the actions of the Houthi rebels following the release of a joint statement that included the US and European Union calling for a cessation of attacks and the release of an "unjustly detained" 25-member international crew.
"It's important that navigation and freedom of movement be allowed - we condemn the actions of the Houthis and the disruption that is occurring," Mr Albanese said.
But Nationals leader David Littleproud said an Australian ship should set sail, amid fears the blockade could jack up oil prices as carriers reroute.
"Of course we should," he said.
"This government is blaming the cost of living crisis on international factors yet when there is an international factor that they can influence by sending a ship and having the free movement of boats ... they are refusing."
Sending the ship would also show Australia wouldn't stand for people breaking the rules and "make a stance about what is right and what is wrong", he said.
US Secretary of Defence Austin Lloyd briefed partners on the security situation in a virtual meeting overnight (AEDT) that included Australian Defence Force chief Angus Campbell.
He has set up a 10-nation coalition under Operation Prosperity Guardian to focus on security in the Red Sea, and seek to protect against missiles and drones being launched by the rebels against merchant ships.
Five Australian personnel are already embedded in the Middle East combined maritime forces command centre, and the prime minister is considering sending more.
Acting opposition leader Sussan Ley questioned why an official response was taking so long.
"Is it because we lack the will or is it because we lack the capability?" she said.
"Our allies deserve us to be honest, upfront and responsive."
Due consideration is being given to the request, government ministers say.