Oil hits US$78 as Iran threatens global supply: Petrol price outlook volatile
Tuesday, 3 March 2026
Oil prices have lifted back up to close to their Monday peak as traders and speculators continue to second-guess the likely course of events in Iran.
However, fears of a $20-plus increase in the price of a barrel of oil have yet to materialise.
The price of Brent crude for delivery in May was US$78.56 a barrel on the futures market in mid-morning trading on Tuesday, up about US$6 on its price before the US and Israel began striking Iranian regime targets on Saturday.
If maintained, that would equate to an increase of about 6 New Zealand cents per litre in the price of petrol.
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A statement by Islamic Revolutionary Guard Corps adviser Ebrahim Jabbari on Iranian state TV, reported by the BBC, that Iran would not let oil leave the region appeared to contribute to the latest lift.
AA policy adviser Terry Collins said that as of Tuesday morning, petrol companies had not raised their prices in New Zealand and motorists did not appear to be rushing to fill up.
Collins said he had bought some fuel online himself at $2.52 a litre this morning to duck an expected price rise.
“I know it’s going to go to $2.60 to $2.70; I am putting my money where my mouth is.”
The messages coming out of the Trump administration suggesting the conflict would go on for “a month, maybe longer”, were confusing, he said.
Asked whether she was concerned the conflict could derail the economy, Finance Minister Nicola Willis said the Treasury and the Reserve Bank were monitoring developments very closely.
“From an economic security perspective, New Zealand has very good fuel supplies. We regulated last year to ensure that we have 28 days’ worth of fuel already in the country, which of course was purchased at prices a month ago, so we wouldn’t expect to see an immediate impact at the pump,” she said.
Further changes could be expected in the price of oil, she said.
“But for context, when Russia invaded Ukraine, it went up to US$120 a barrel, so we’re not seeing an outside effect of that nature.”
The Reserve Bank is due to review the Official Cash Rate next month, she noted.
“That will provide a juncture at which they can offer a full reflection on the data and the developments and set out their decisions accordingly.”
Customs Brokers and Freight Forwarders Federation chief executive Sherelle Kennelly said on Monday that its members were already seeing “significant operational disruptions across both air and sea freight”.
Several Middle Eastern countries have closed their airspace or imposed heavy restrictions and heightened security risks in the Red Sea, Bab el-Mandeb Strait, and Strait of Hormuz have led to some shipping firms suspending sailings.
“Time-sensitive exports such as horticulture, seafood, and high-value perishables may experience delays,” she said.
Kennelly said on Tuesday the situation was unchanged. “There are no further updates today.” The impact of the disruption depended on how long it went on, she said.