Prime Minister Christopher Luxon has warned that New Zealand is bracing for a prolonged disruption to fuel supplies as tensions in the Middle East continue to escalate. Officials have been directed to prepare for a worst-case scenario in which supply chains could be affected for up to 12 weeks.
According to a report by Justin Hu of 1News, speaking after a briefing alongside Finance Minister Nicola Willis, Luxon said the government was planning ahead even in the event of a sudden ceasefire.
"I do want to be straight with New Zealanders, things could get worse before they actually get better," the PM said, according to 1News.
Luxon described the situation as "one of the most significant oil shocks we've had in history" and stressed the importance of readiness over optimism.
"Like all New Zealanders, we hope the conflict is ending quickly, but hope is not a plan, and so we are preparing for the worst-case scenario where the conflict is prolonged," as quoted by 1News.
The government’s response is focused on three key areas: securing alternative fuel supplies through international diplomacy, working closely with domestic fuel companies, and implementing contingency measures outlined in the national fuel plan introduced in 2024. Luxon confirmed he has already spoken with leaders from Australia, the United Arab Emirates, and Qatar.
Highlighting the cumulative strain on the country, Luxon said:
"Kiwis are incredibly resilient, but the last few years have been very difficult for households and businesses across the country. We've been knocked around by the pandemic, then the recession, high inflation, the tariffs and now the Middle East conflict, as reported by 1News.
"We can't control global events, but we can control our response to them."
He added: "Whatever happens, we will continue to deliver the responsible economic management needed to minimise the impact for Kiwis," as quoted by 1News.
Fuel Supply and Public Response
Despite growing concerns, Luxon noted that New Zealanders had largely avoided panic buying.
"What we've seen is, actually, very good behaviour from New Zealanders, in the sense of, we haven't seen massive stockpiling and going across the country.
"We might have it in localised places, but I think New Zealanders have actually been very good and we are reassuring New Zealanders that we have the supplies,"
Willis acknowledged reports of isolated shortages, including diesel outages at some Wellington stations, but said importers still had enough supply to restock.
However, she warned of potential future challenges due to reliance on fuel imports from countries like South Korea and Singapore, which are themselves facing supply pressures.
"We can anticipate that, in the future, they may be producing less fuel for the global market, which will make it more challenging for our fuel importers to access supplies," as quoted by 1News.
The government is now considering scenarios where fuel prioritisation may become necessary.
"The third area of focus for the Government is considering a world in which disruptions to fuel orders are such that domestic prioritisation measures may be required," Willis said, as quoted by 1News.
Economic Concerns and Targeted Support
The briefing coincided with the release of new GDP figures showing three consecutive quarters of economic growth, though Willis cautioned against relying on the data.
"I'll just be frank, that's very backwards-looking data. We're now in a new world," as quoted by 1News.
She confirmed that the government is exploring targeted support for households most affected by rising fuel costs, but ruled out broad financial assistance.
"We have actively sought advice on the methods by which we can provide very timely, targeted support to those households we anticipate will be most affected by increasing prices and who are not able to avoid them," as quoted by 1News.
At the same time, she emphasised fiscal restraint:
"We acknowledge that these price increases are impacting every New Zealander, but it would be, at this point, irresponsible for us to help every New Zealander," she said.
"If the Government spends too much right now, it will lead to higher inflation and more price surges across the economy, which could lead us into a vicious spiral," 1News has quoted.
Willis also pointed to increasing global instability and rising borrowing costs, noting that officials have already engaged with hundreds of businesses to assess impacts and coordinate responses.
Fuel Reserves and Outlook
According to the Ministry of Business, Innovation and Employment, New Zealand currently holds nearly 49 days of fuel supply, combining reserves in the country and shipments en route. Additional fuel vessels are expected to arrive in the coming days.
While the system remains in the early “minor disruption” phase of the National Fuel Plan, officials continue to monitor the situation closely. The government has urged the public to maintain normal purchasing habits, warning that panic buying could worsen supply pressures rather than alleviate them, as reported by 1News.
As the global situation evolves, authorities say preparedness and measured responses will be key to navigating the months ahead.
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