From petrol tank to food costs: rising fuel prices eat into household budgets
Saturday, 21 March 2026
The bombs, missiles and drones are falling half a world away, but the fallout from the conflict in the Middle East is already hitting those in Taranaki who can least afford it.
Jocelyn Merwood, the manager of the New Plymouth Budget Advisory Service, said a lot of people were feeling helpless.
“They haven’t done anything differently, but they are impacted,” she says.
Prices at the fuel pumps have been steadily rising since the United States and Israel began bombing Iran on February 28, prompting a massive retaliation that included sending missiles and drones into Gulf states and closing the Strait of Hormuz, a major shipping lane for oil tankers.
Petrol has already increased by more than 50 cents a litre, while diesel was at $1 more per litre than just a few weeks ago.
An Israeli attack on Iran’s South Pars gasfield on Wednesday sent global oil and gas prices soaring further, and they took another hit when Iran retaliated on Thursday with an attack Qatar’s Ras Laffan LNG complex, the world’s largest.
With no end to the conflict in sight, early speculation about whether petrol prices would reach $4 a litre petrol no longer seem alarmist.
On Thursday Prime Minister Christopher Luxon was blunt about the situation, saying: “Things could get worse before they actually get better.”
Finance Minister Nicola Willis then announced the Government was working on a package of targeted financial support for the families worst hit by high fuel costs brought on by the Iran war.
“These price increases are impacting every New Zealander, but it would be at this point irresponsible for us to help every New Zealander,” Willis said.
One of the challenges for people was not knowing how long the high fuel costs would last, Merwood says.
“If it’s a week or a month, people can absorb that, but if it is long term, people will have to look at finding different ways to absorb fuel costs, how they can do things differently in regards to transport.”
Barbara Hurcomb from the Hāwera Foodbank was also already seeing demand for help rise as people who were already struggling now tried to cope with increasing fuel costs.
The food bank gave out 46 parcels this week, she says.
“On Wednesday I received a text message from somebody seeking help. They said they had spent their grocery money on petrol to get to work.
“People are finding it tough on top of paying rent, power and phone. They just can’t make ends meet. It’s going to make it extremely difficult in the weeks ahead.”
The food bank’s van normally cost about $120 to $130 to fill, but this week’s total was $165. Next week it is likely to be even more.
“I’m trying to limit how many times I take the van up town, trying to do everything all at once,” Hurcomb says.
“I don’t know how some of them [clients] are going to get on.”
In a bid to get ahead of rising fuel prices, those who can are buying electric cars while other motorists are keeping their cars topped up to minimise their exposure to daily price increases.
A run on fuel at Pak’nSave in Hāwera on Thursday saw the pumps run dry. The same thing happened at New World in New Plymouth.
Without a rapid resolution to the conflict, fuel price increases will be felt at more than just the pump as the increased cost of doing business trickles through to just about everything, warns Egmont Seafoods managing director Keith Mawson.
“We [New Zealand] are pretty sparsely spread. Fuel is a pretty significant component of most things people buy,” he says.
Even a feed of fish and chips is likely to go up, with fishing boats already counting the cost of a catch.
“We’ve seen the diesel price go up $1 a litre already, plus GST. It’s going to make a significant difference, depending where it ends up,” Mawson says.
A typical trip used 2000L of diesel, so a $1 rise added another $2000 per trip coming off the bottom line.
“We already operate on pretty fine margins – you’re not guaranteed when you go out there is going to be a good catch,” he says.
“It certainly could have an impact on supply and ultimately will have an impact on the price of fish, not only from harvesting.
“It also adds to the cost of moving product around the country. We move product all over the North Island and for export.”
In South Taranaki, the boost in diesel costs has coincided with peak maize harvesting season, says Alastair Kalin, the owner of Kalin Contracting in Normanby and a board member of Rural Contractors New Zealand, an industry association.
“Over the next four to six weeks we will use one-third of the fuel required for the season,” he says.
“It’s a massive cost. Our choppers are using 600L to 700L a day, and then there are the trucks. We are paying a huge amount more to run the same operation as three weeks ago.”
It has meant a price rise, as contractors were now adding a fuel adjustment factor to invoices and would review it week by week, he says.
In New Plymouth, public transport advocate Suraya Sidhu Singh sees sustainable travel options as one way some people can insulate themselves from increasing costs.
Her advice was to first research the options such as cycling, carpooling, walking or taking a bus.
“If someone has been driving to work for 20 years, they may not have explored if there are any other convenient options,” she says.
“I think the longer it goes on, the more people will be thinking about how they can go about making the changes.”
The Taranaki Regional Council’s new bus network and timetable, which launches on April 7, will be helpful for many people, Sidhu Singh says.
At $2.50 per journey for adults (with a Bee Card) within the New Plymouth District or $6.25 from Hāwera to New Plymouth, it was a cost-effective alternative to private cars.
The regional council’s transport engagement manager, Cheryl Gazley, was also encouraging people who don’t use the bus to give it a go.
“We have plenty of capacity to take on more passengers, so at this stage there are no plans for additional buses.
“We’re keeping an eye on passenger numbers but it’s too early to say if the fuel situation has yet had any impact.”
The new Te Pahi bus network will have more direct and streamlined urban services, new Saturday regional services and a new city Saturday Orbiter.
The council is also adding 11 electric buses to the fleet and launching a new website with a journey planner and live tracking functions.
For those who cannot find alternatives to their cars, a Massey University sustainable energy and climate mitigation expert says the vast majority of drivers could save 15% to 20% of fuel by driving smoothly without heavy acceleration and braking.
Emeritus Professor Ralph Sims says checking tyre pressure, turning air-conditioning off, removing excess weight and slowing down also help.
Typically a car travelling at 110kph uses 10% more fuel per kilometre than when travelling at 90kph because of greater air friction, he says.
“It’s all pretty basic and the science is well understood for cars, trucks and buses. But to change human behaviour is always the challenge.”