Fuel Costs Are Surging — What It Means for Your Business

If your business involves a vehicle, fleet, or any kind of freight and logistics, the current fuel crisis is hitting your bottom line hard — and the risks go beyond price alone.

Where Things Stand

The escalating conflict in the Middle East has disrupted global oil supply, and New Zealand is feeling it at the pump. Petrol has risen around 55 cents per litre since the crisis began, while diesel — the lifeblood of freight, farming, and trades — is up approximately 90 cents per litre. Some Auckland stations have already hit $4.00 per litre, and economists warn a $4 national average is possible if the conflict continues.

But it's not just about price. The Government has activated a four-phase National Fuel Plan in response to supply chain risks stemming from the Iran conflict. While fuel stocks have improved slightly in recent days — diesel reserves rose from 18 days in-country last week to nearly 22 days now — the volatility highlights a vulnerability many businesses haven't had to consider since the 1970s oil shocks.

New Zealand currently sits at Phase 1 of the National Fuel Plan — the lowest level of concern. The Ministry for Business, Innovation and Employment (MBIE) now publishes twice-weekly fuel stock updates, so the numbers are shifting regularly. However, the Government has confirmed it will escalate restrictions if certain triggers occur, including export restrictions from supplier countries, a three-day drop in fuel stocks, fuel companies unable to fill orders, or significant regional distribution disruptions.

What This Means for Your Business

Fuel dependency isn't just a transport issue. If rationing kicks in at higher phases, businesses could face:

• Restricted vehicle use — limiting sales calls, deliveries, or service appointments
• Increased costs — priority access schemes may come at a premium
• Supply chain delays — suppliers and freight operators will face the same constraints
• Cashflow pressure — stockpiling fuel (if permitted) ties up working capital

Practical Steps to Take Now

Don't wait for Phase 2. There's plenty you can do today to protect your business on both the cost and supply fronts.

Get your finances in order. Make sure your fuel-related tax claims are up to date — motor vehicle expenses, fuel cards, and logbooks all count. If fuel costs spike or you need to pre-purchase, stress-test your working capital with your accountant now rather than later.

Review your pricing. If fuel is a key input cost, consider whether it's time to update your rates or add a fuel surcharge clause to contracts.

Cut waste and plan smarter. Use apps like Gaspy to find the cheapest fuel nearby, consolidate trips, plan efficient routes, and encourage remote work for staff where possible.

Check your supplier agreements. Are your logistics providers or freight partners communicating their own contingency plans? If not, ask.

Document essential travel. If rationing arrives, you may need to justify fuel allocation. Start categorising business travel as "essential" versus "discretionary" now.

The Bigger Picture: Electrification Is Now a Financial Decision

Businesses running EVs right now are barely noticing the crisis at the pump. EVs run on New Zealand-generated electricity — no Strait of Hormuz, no shipping margins, no currency risk. A Consumer NZ survey released this month found that 96% of EV owners would never go back to petrol.

Combine an EV fleet with rooftop solar and you're powering your transport directly from the sun — with costs you can actually predict, regardless of what happens in the Middle East.

The Government has also just confirmed $52.7 million in zero-interest loans to more than double New Zealand's public EV charging network. The infrastructure is coming fast.

Where to Go from Here

Fuel security may not have been on your risk register a month ago, but it is now. Whether you want to talk through the tax treatment of an EV purchase, run the numbers on solar, review your pricing structure, or build contingency planning into your financial forecasting — get in touch with our team.

This article is intended as general guidance only and does not constitute personalised tax or financial advice. Please contact Epplett & Co to discuss your specific situation.