‘There is a role for diplomacy here’: Finance Minister Nicola Willis says the Government does anticipate working with fuel companies, if needed, says banks will provide customers 'an umbrella'

Finance Minister Nicola Willis says the Government does "anticipate working with fuel companies if needed to help secure orders" as war in the Middle East continues.

While Channel Infrastructure, which operates New Zealand's largest fuel import terminal, is not seeing any issues and ships carrying fuel are continuing to depart for New Zealand and arrive as scheduled, there could be a point in the future, Willis says, at which fuel importers face challenges securing orders.

"That is because the Asian fuel refineries who New Zealand imports most of our fuel from, do typically rely on the Middle East for their stocks of oil."

According to economic consultancy Infometrics, data from 2025 shows South Korea provides the largest value of fuel imports into New Zealand - contributing 48%. This was followed by Singapore, which contributes about 33% of total fuel imported.

Willis says the Government has a fuel sector coordinating group which is critical "to getting market insights about whether they are facing those challenges so that we can work effectively together to get out ahead of them”.

“We also have as a core principle, working closely with industry and businesses that are affected, to ensure Government is reacting and being proactive in a timely manner,” Willis says.

“We do anticipate working with fuel companies if needed to help secure orders. There is a role for diplomacy here. That would include things such as looking at fuel specifications so that fuel importers could widen the areas in the world from which they source fuel.”

Other options include coordinating with Australia and Singapore fuel industry participants, reducing the minimum stock holding obligations that firms face so “they can dip into the buffer that we have”.

“That, of course, is what the buffer is there for.”

Asked what conversations she's had with South Korea and Singapore, Willis says the core message from South Korea is that they are intending to keep their exports going at 2025 levels.

“Their concern there is to prevent people stockpiling, upping their orders above what they’ve previously ordered, in order that they can maintain supply to existing customers.”

When it comes to Singapore, Willis says it’s their intention to honour their commercial supply arrangements. She says New Zealand has a close relationship with Singapore and this includes a supply agreement - while this hasn’t entered into force, it’s there in spirit.

She says this speaks to the fact that Singapore would look to New Zealand as a priority “were there to be any measures restricting availability”.

Increasing demand at petrol stations

Alongside this, Willis says it has been reported on and observed that demand at some petrol stations has increased.

“Petrol prices have risen about 45 to 50 cents a litre, adding about $23 to the cost of filling an average car. We are acutely conscious of the impact this will be having for many New Zealanders.”

Diesel prices have also increased to about 72 cents a litre - adding about $36 to the cost of filling an average diesel vehicle.

“Despite these increases, prices are still slightly below their 2022 peak, although it is reasonable to assume they could go higher if the conflict is prolonged."

Willis says banks to provide 'am umbrella'

Willis says she has also talked with each of the chief executives of the major commercial banks.

“They have assured me that in the first instance, they will be providing an umbrella to businesses that they already work with to ensure that they can take them through this challenging time."

When asked about the “umbrella” that banks would be providing for its customers, Willis says she would leave the commercial banks to speak for themselves.

“What I sought to understand from the banks is what they’re seeing already with their customers, whether they’re having particular concerns for sectors, industries … whether they’re seeing particular customers impacted in specific ways and so I will leave them to share that on their own terms,” Willis says.

She says many customers judge their bank by how it treats them in hard times and they all want to be seen as being good bankers that don’t abandon their customers in difficult times.

“They all acknowledge that the impacts of events like this are really variable. You’ll see one firm that will have its fuel price completely hedged to the end of the year and so it doesn’t feel any impact - in fact, it potentially sees it as an upside," she says.

“Another firm down the line might not have any fuel hedging and might find themselves very exposed. So they acknowledge that the picture is variable.

"They know their customers best. They understand what the underlying drivers of their business models are and what might be needed if push comes to shove.”