MELBOURNE, AUSTRALIA - MARCH 26: Romain Grosjean of France driving the (8) Haas F1 Team Haas-Ferrari VF-17 Ferrari on track during the Australian Formula One Grand Prix at Albert Park on March 26, 2017 in Melbourne, Australia. (Photo by Mark Thompson/Getty Images)

The Australian Formula One Grand Prix has been cancelled for the second straight year after the FIA, teams and the local government failed to work through strict quarantine restrictions to allow the event to proceed.

Victorian Sports Minister Martin Pakula confirmed the cancellation on Tuesday, with the Phillip Island MotoGP also not going ahead.

"It's very disappointing that these much-loved events can't proceed but this is the reality of the pandemic - but until we get much higher vaccination rates we cannot return to more normal settings," said Pakula.

"We are getting to work on plans for 2022 immediately and can't wait to welcome the world's best drivers and riders and all motorsport fans back to Albert Park and Phillip Island."

The Australian GP, which is traditionally the season opener, was postponed to November in January after organizers conceded it was "not feasible" to hold the race in March.

Australia's only current F1 driver Daniel Ricciardo released a statement along with the cancellation, expressing his disappointment but understanding of the decision.

"It's a huge disappointment for all of the drivers that we won't be coming down to Australia in November, but we understand the reasons.” The McLaren driver said.

"For me personally, I can't wait to have the chance to race at home again, and it'll be even sweeter when we do because it's been so long. Fingers crossed things can change for 2022 and we get to see the awesome fans at Albert Park again and put on a good show for them."

Formula One has largely been based in Europe so far in 2021, where open borders and easier quarantine arrangements have allowed the season to go ahead. At the moment, any international traveller entering Australia must undergo two weeks of mandatory hotel quarantine.

The 2020 Melbourne race was infamously called off hours before the first practice session due to Covid-19, which was classified as a pandemic by the World Health Organization three days before the race.

McLaren had already withdrawn after a team member tested positive after arriving in Melbourne. After the cancellation, it was revealed that only three teams, Red Bull, AlphaTauri and Racing Point, were willing to race if given the green light.

Australia joins Canada and Singapore among countries with cancelled races on the 2021 calendar. There is no clear replacement as of yet, but the following race in Saudi Arabia and then Abu Dhabi presents an opportunity for a potential Middle East triple header to close the season. While a potential double-header in Brazil also looms as a potential replacement.

Formula One boss Stefano Domenicali remained firm that the season would continue with 23 races, despite the Australian cancellation.

“While it is disappointing we won't be racing in Australia this season, we are confident we can deliver a 23 race season in 2021 and we have a number of options to take forward to replace the place left vacant by the Australian Grand Prix,” Domenicali said.

“We will be working through the details of those options in the coming weeks and will provide further updates once those discussions are concluded.”

Melbourne has hosted the race at the Albert Park circuit every year, except 2020, since 1996. In 2019, The Australian Grand Prix Corporation and Formula One signed a deal to keep the race in Melbourne until at least 2025.