Government moves to widen its fuel supply options

The Government has moved to widen its fuel supply options, agreeing to temporarily allow petrol and diesel that meet Australian specifications to be sold domestically as it works to manage ongoing supply pressures.

Resources Minister Shane Jones confirmed Cabinet’s decision, saying the short-term alignment with Australia would give importers greater flexibility and help ease strain on the country’s fuel reserves.

By permitting fuel refined to Australian standards, officials hope to open additional supply channels during what has been described as a fuel security crunch. However, the Government has stopped short of fully mirroring Australia’s approach, which includes allowing higher sulphur fuel in certain circumstances to access supply from refineries such as Brisbane.

Addressing concerns about fuel quality at a post-Cabinet briefing alongside Prime Minister Christopher Luxon and Finance Minister Nicola Willis, Jones pushed back on criticism of the move.

“I think that it’s unkind of us to refer to our Aussie compatriots as dirty,” he joked.

“…some of the specs that exist in Australia are slightly higher than what we have in New Zealand…”

The temporary measure could remain in place for up to 12 months if required, depending on how global supply conditions evolve.

Luxon said New Zealand currently has enough fuel to last around seven weeks and stressed that the market continues to function normally. However, he acknowledged the need for contingency planning should international supply chains tighten further.

Joined by Willis and Jones, Luxon said rising fuel prices were placing pressure on households, but noted there was no simple fix to ease costs across the board.

Fuel was needed to “ensure people can get to work, kids to school, and farmers and transport around the country.” “Fuel security is without doubt the most pressing issue,” he said.

The Prime Minister also confirmed he would be engaging with international partners in the coming days, including leaders in South Korea and Singapore. He has already spoken with Australian Prime Minister Anthony Albanese, with both countries expected to work closely together on supply resilience.

Willis said her priority remained the impact of the global situation on fuel availability and pricing, adding that further support measures would be announced shortly for households hardest hit by rising costs.

She said the latest fuel supply data, released earlier in the day, remained in line with typical levels.