Seven-week fuel buffer, but diesel risk grows as Greens pitch relief and government backs EV push

Summarised by Centrist

Finance Minister Nicola Willis says New Zealanders can be reassured the country still has about seven weeks of fuel security.

Willis notes that ships continue to arrive, and there are roughly 300 million litres of fuel on site at Marsden Point. 

However, diesel shortages could do serious economic damage well before the country fully “runs out” of fuel.

Willis visited Channel Infrastructure at Marsden Point as petrol prices climbed well above $3 a litre in many parts of the country, driven by disruption linked to the US and Israeli attacks on Iran and the effective blocking of the Strait of Hormuz. 

She said the government was considering limited relief for households ahead of May’s Budget, but ruled out broad fuel tax cuts, claiming they would not help the people most in need.

The more pressing issue is whether diesel remains available. Willis warned that “if we don’t have diesel, it would affect thousands of jobs.” Diesel is central to freight, logistics, heavy machinery and supply chains.

Economist Shamubeel Eaqub said “diesel is literally the lifeblood of the economy” and warned that even if there is enough fuel in total, breakdowns in distribution could leave trucks, freight and livestock stranded.

At the pump, the pressure is building. Eaqub said current spot prices in Singapore and Korea implied petrol could be closer to $3.80 a litre, while Infometrics’ Gareth Kiernan said $4 for 91 was looking increasingly plausible. 

The Greens have offered National their votes for a fuel relief package that includes free public transport, targeted payments for lower-income and rural New Zealanders, including people on benefits, and a windfall tax on fuel companies.

The government is also pushing a longer-term response, backing a $110 million expansion of EV chargers as fuel price volatility renews interest in switching away from petrol and diesel.

Even if a ceasefire came now, both economists said disrupted supply flows would still take time to recover, with the real crunch likely in May or June.

Read more over at Stuff and RNZ

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