Iran war: Fuel pressure builds as Government prepares to unveil high-level response plan
Thursday, 26 March 2026
ANALYSIS: Friday is shaping up as the day the Government puts some meat on the bones of its fuel plan.
Finance Minister Nicola Willis confirmed on Wednesday that the Government will keep its powder dry until Friday, when it will unveil the next steps and how it might all work.
Willis laid out the questions that Friday would answer.
“We will give answers to some of the questions that New Zealanders are asking: What will that framework look like? What are the different phases of response that the Government envisages? What would be the triggers to move to additional measures? How would ministers assess that? How would they work with the industry to make those things happen?”
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It is understood the plan will be reasonably high-level, with officials still scrambling to put it together ahead of Friday’s announcement. MBIE is understood to have dragged all manner of officials working on other things across to fuel.
The exact timing of the announcement remains unconfirmed.
“We are taking the development of a National Fuel Plan very seriously, and we will outline our approach to that on Friday,” Prime Minister Christopher Luxon said.
The plan comes as more businesses around the country — especially unhedged, heavy diesel users — begin to scramble, seeking clarity from the Government on how they would be treated in the event of demand management measures.
In ordinary parlance, that means rationing.
It should be added that New Zealand currently has no supply problem with petrol or diesel. Ships are arriving as expected. The issue is price; global market prices have risen, and both retailers and consumers are paying it, depending on where fuel is sourced.
Despite reports of petrol stations running out of fuel around the country, these shortages reflect elevated demand over the past three weeks, as consumers bring forward purchases to try to get ahead of further price rises.
As a result, some stations and especially more isolated or rural stations have run out of fuel. But this is not because the country is short — it is because demand has surged.
As of Sunday, the country has 24.5 days cover of petrol in New Zealand or its EEZ, 18.1 days of diesel and 20.1 days of jet fuel.
On its way here are 24.2 days of petrol, 28.3 days of diesel and 23.4 days of jet fuel.
The biggest risk for New Zealand remains that the markets it relies on for refined fuel — such as South Korea — turn protectionist. That is, look out for their own fuel interests first.
That is a real possibility. Only two weeks ago on The Post, Willis, who recognised the potential risks arising from the Iran War early, said she would be doing as much.
“This is a time when New Zealand has to put its interests first and fight hard for our interests,” she said.
“New Zealanders need fuel. It’s critical to our economy. And as ministers, we will be fighting to secure that fuel.”
But New Zealand is not alone in that thinking, nor is Willis the only finance minister taking that view.
But New Zealand produces neither the sour crude oil needed for refined fuels nor — since Marsden Point closed — the capacity to refine it domestically. Its up to energy companies to continue to do their thing and to secure it at this stage.
It may not come to that, but Luxon has spoken with both South Korean and Singaporean leaders in recent days. In theory, New Zealand has a fuel-for-food swap arrangement with Singapore if needed (though not necessarily at the same time).
Across Asia, various forms of rationing are already in place.
New Zealand is also a major customer of Korean refineries. Any crunch in refined fuel supply will test the strength of those relationships. Korea has already announced its own rationing measures, including five-day vehicle rotations and requests for the top 50 fuel users to cut usage. New Zealand purchases about half of its refined fuel from Korea.
Friday should at least give firms some guidance on what things might look like if fuel does run short. Hopefully it won’t be needed — but, as the prime minister said last week, hope is not a plan.
It will be the first major test of the Government in this crisis.