Iran war: The National Fuel Plan's four levels - and when we move between them
Tuesday, 17 March 2026
ANALYSIS: As the war in the Middle East continues the Government is dusting off a plan created for exactly this kind of fuel shortage.
The National Fuel Plan is the Government’s blueprint for dealing with a range of fuel disruption from slightly elevated costs to rationing petrol for lifeline services.
It could be triggered by a range of emergencies such as a natural disaster, an infrastructure failure, or in the current context an international war, as the Strait of Hormuz ‒ where about the one fifth of the world’s oil transits ‒ is effectively closed.
It is created by the National Emergency Management Agency (NEMA) and the Ministry of Business, Innovation, and Employment (MBIE) and reviewed every three years, with the latest version published in 2024.
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The latest plan took into account the closure of the Marsden Point refinery in 2022 which stopped New Zealand’s ability to refine fuel domestically.
What are the escalation levels?
Under the plan there are four levels ‒ a little bit like the Covid-19 response system.
Currently New Zealand is under level one of the plan, which indicates there is a minor effect on the fuel sector but the potential for the situation to escalate.
Fuel companies are required to notify the head of a sector co-ordinating entity, a group chaired by MBIE and made up of petrol companies to plan for potential disruption.
NEMA also has to notify local Civil Defence groups of the situation.
The next step up ‒ level two ‒ is more significant in real terms for everyday fuel users, with measures put in places to prioritise fuel usage such as designated stations and lanes for people to fill up.
While motorists would still have the the ability to fuel up at level two, critical users such as emergency service personnel, lifeline utilities and health workers would be prioritised to manage stocks.
At level three, New Zealand’s fuel supply would be seriously impacted and we would see more fuel prioritised for those critical users.
Alongside the prioritisation of fuel at level three, the plan also discussed the possibility of measures such as petrol station opening hour restrictions, setting maximum purchases, and restricting sales of fuel to containers to discourage hoarding.
It’s likely that a state of emergency would also be in place.
For the highest tier ‒ level four ‒ New Zealand would have to be facing severe constraints, and fuel would only be provided to critical customers.
When would we go to level two?
MBIE told The Post for New Zealand to move to level two there would have been a risk of fuel shortages to critical customers. The agency stressed the country was not at that level yet.
“To be clear, we are not yet experiencing the types of sustained supply disruption that the National Fuel Plan enables as emergency measures at level 2 and beyond.”
MBIE said Ministers were taking advice on the “appropriate triggers” for moving up escalation levels, including level two.
Who would decide that?
Under the plan the decision to make a change in levels can be initiated by a Civil Defence national or group controller in a declared state of emergency.
MBIE said the Government could decide to escalate its response if the situation worsened.
“Officials are providing advice to ministers on relevant considerations for that now, and we will have more to say once they have considered that advice.”
It is likely it would ultimately be Cabinet that made this call.
Where did the fuel plan come from?
The National Fuel Plan is underpinned by three pieces of legislation, the International Energy Agreement Act 1976, the Civil Defence Emergency Management Act 2002 and the Petroleum Demand Restraint Act 1981.
The 1981 law was put into place a year after New Zealand scrapped carless days ‒ an initiative brought in under the Muldoon government to reduce petrol consumption.
New Zealand as well as several other countries signed up to the International Energy Agreement in response to the 1973-74 oil crisis to respond to any potential oil disruptions and develop energy conservation policies.
The law associated with the agreement required New Zealand to consult with member countries before declaring an oil emergency.