SYDNEY (BLOOMBERG) - Prime Minister Scott Morrison is urging Australia's state and territory leaders to move ahead with reopening plans as Omicron outbreaks push daily coronavirus infections to record levels, causing havoc ahead of the nation's summer vacation period.

"The idea that you're going to suppress it at any extreme level or you're going to eliminate it, that's nonsense," Mr Morrison said of the Omicron variant in a television interview on Wednesday (Dec 22). "We have to live with it and we have to just stay calm."

Like in other nations such as the US, Omicron is putting pressure on Australia's push to fully reopen, after the most populous states New South Wales and Victoria recently removed months-long lockdowns and other restrictions which the Prime Minister says are now unnecessary due to a relatively high vaccination rate.

The national vaccination rate for people aged 16 and over is now 90.6 per cent.

Complicating Mr Morrison's bid is that jurisdiction over public health measures such as mandatory mask-wearing and density limits lies with the eight states and territories, which are all taking different approaches to reopening.

New South Wales, which includes Sydney, on Wednesday reported 3,763 new infections, up more than 700 cases from the day before, with authorities saying the vast majority of cases are Omicron.

While hospitalisations from coronavirus in the state have almost doubled in the past week, they currently sit at about 300 and officials say the rate is not putting pressure on the public health system. Forty people are in intensive care.

New South Wales Premier Dominic Perrottet, a champion of opening up and living with the virus, has removed mask mandates for most places and allowed clubs and pubs to reopen at full capacity.

Meanwhile, Victoria state recorded about 1,500 new cases on Wednesday, with 394 people hospitalised and 70 active intensive care cases.

"What we are seeing is massive outbreaks, a lot stemming from places like nightclubs and pubs," Australian Medical Association vice-president Chris Moy said in a television interview on Wednesday.

"It makes absolute sense as soon as possible to implement pretty simple things like mask-wearing" and venue density limits, he said.

Meanwhile, the outbreaks are causing concern in states such as Queensland and Tasmania - which have had hardly any community infections since the pandemic began - that this month removed quarantine restrictions to bolster tourism ahead of the main summer vacation period.

Those states are now insisting travellers from interstate must produce a polymerase chain reaction Covid-19 test that shows they were negative within 72 hours of arrival. That demand has seen government-run testing clinics in several states overwhelmed by would-be interstate travellers. While there are calls for rapid antigen tests to be accepted, there is also a shortage of them.

On Tuesday, the Australian Capital Territory reimposed mandatory mask-wearing in indoor public places including shops and workplaces in Canberra, with other jurisdictions under pressure to do the same.

"What we're trying to do in Australia - and it's not easy with something like Omicron - is show it's better to keep things in check if you possibly can by dialling up those more general population precautions and avoiding the chance of having a lockdown," Dr Catherine Bennett, chair in epidemiology at Melbourne's Deakin University, said in a Bloomberg Television interview on Wednesday.

Mr Morrison will try to calm nervous state leaders at a meeting of the national Cabinet. He has a lot riding on leading Australia to a relatively normal summer period, with polls showing his conservative government trails the main Labor opposition ahead of elections that need to be held by May.

He has been promoting the fact that Australia has recorded only around 2,100 deaths from Covid-19 since the pandemic began, and the economy is emerging in relatively healthy shape.

"The indications are that it is not as severe, and our hospitals, particularly in New South Wales and Victoria, have been coping extremely well," Mr Morrison said of Omicron in another television interview on Wednesday. "We can't have those case numbers with casual contacts shutting down the whole economy, because then we'll see people losing their businesses and losing their jobs."