March 21, 2026

#TeKaupapa | Fuel, war and the rising cost of living

Matthew Tukaki Posted On March 21, 2026

Fuel prices are once again dominating the conversation across Aotearoa, and for many whānau the impact is already being felt well beyond the petrol pump.

What is unfolding globally is now flowing directly into everyday life here at home. The escalation of conflict involving Iran has disrupted oil supply through the Strait of Hormuz, one of the most critical energy corridors in the world. Around a fifth of global oil supply moves through that narrow passage, and any instability there sends immediate shockwaves through international markets.

Those shocks are now reaching Aotearoa.

Fuel prices are climbing rapidly, with petrol and diesel increases being reported across the country. But the real issue is not just the cost of filling up a car. Fuel sits at the centre of the entire economy. When it rises, everything connected to it follows.

Freight becomes more expensive.
Air travel costs increase.
Power generation faces pressure.
And food prices inevitably rise as transport and production costs climb.

For many households, already navigating a cost-of-living crisis, this represents another layer of financial strain. The ripple effect means higher grocery bills, increased travel costs, and more pressure on already stretched weekly budgets.

New Zealand’s position makes it particularly vulnerable to these global shifts. The country imports refined fuel and relies heavily on international supply chains. While officials indicate there is roughly 50 days of fuel supply available through a mix of domestic storage and shipments, that buffer does not shield consumers from global price volatility.

The exposure is immediate and unavoidable.

Businesses are already warning that rising fuel costs will be passed through to consumers. Transport operators, logistics companies, and airlines are facing increased operating costs, and those costs ultimately land with the public.

The result is a likely prolonging of inflationary pressure, at a time when many had hoped costs might begin to stabilise.

This situation is also reigniting debate about national resilience and energy security. The closure of the Marsden Point refinery has returned to the spotlight, with questions being raised about whether New Zealand has sufficient domestic capability to withstand global disruptions.

At the heart of the issue is a broader question: how prepared is Aotearoa for sustained global instability?

Fuel is not just a commodity. It underpins the entire economy. When supply is threatened and prices surge, the effects are immediate, widespread, and deeply felt across every community.

For Te Kaupapa, the focus now turns to what this means for whānau, for business, and for the future direction of energy policy in Aotearoa. As global tensions continue, the pressure at home is only just beginning.