In 2022, around the time Marsden Point transitioned from refining to an import terminal, we published two articles (It's time for a New Zealand energy security strategy - why the recent global petroleum supply concerns matter and New measures to bolster fuel resiliency plan) making the case for New Zealand to hold more onshore fuel reserves than was being proposed by the government at the time, given our long supply lines, the loss of our sole onshore refining capability, and the significant impact on our economy if fuel supply was ever disrupted.
At the time, the government was looking at various initiatives. The one it ultimately enacted requires that from 1 January 2025, fuel importers must hold, on average, 28 days' cover for petrol, 24 days' cover for aviation kerosene (jet fuel), and 21 days' cover for diesel. Each importer's obligation is calibrated to their own historical drawdown volumes (based on average daily drawings from bulk storage facilities in New Zealand), rather than to a national consumption figure. A fuel importer with a large market share will carry a proportionately larger absolute volume obligation.
The stock can either be held in bulk storage facilities in New Zealand or be physically offshore on a vessel in New Zealand's exclusive economic zone (EEZ) that is scheduled for delivery to a New Zealand port. This is the on-water within EEZ component of New Zealand's reserve levels that features in MBIE's public stock reporting: Fuel stocks update.
What is not counted as part of the minimum stock obligation (MSO) is:
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International Energy Agency (IEA) oil tickets (ie fuel held by the government to comply with obligations under the International Energy Agreement to maintain emergency reserve commitments) – the government has called on some of these IEA oil tickets to release about 1.577 million barrels of crude oil or equivalent; and
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Fuel imported for government consumption (e.g. by the New Zealand Defence Force).
The 2026 Middle East conflict has provided a real-world test of New Zealand's fuel resilience framework. The framework appears, in material respects, to be holding. As at 10 May 2026, New Zealand's reserves stand at approximately 59 days of petrol, 45.2 days of diesel, and 50.2 days of jet fuel (significantly more than the MSO), with the country remaining at Phase 1 of the National Fuel Response Plan, developed by the government in March 2026, even though the conflict has continued for over two and a half months .
However, the government has recognised that there is not as much diesel in storage given its critical role in transport, agriculture, construction and for emergency services. Accordingly, it is now urgently paying for additional diesel storage capacity at Marsden Point to add around nine days of supply. This was one of the initiatives the government had investigated in 2022, but which was not ultimately implemented. It is encouraging to see it being implemented now.
New Zealand receives refined fuel from Korea, Singapore, and Malaysia, each of which sources crude from the Gulf and refines it domestically. The disruption to flows through the Strait of Hormuz has resulted in a significant reduction in global supply (approximately 9%) and a significant increase in prices. These price signals are driving a rebalancing of global supply routes, with crude from North and South America and other parts of the Middle East beginning to feed Asian refineries. However, this rebalancing merely substitutes the origin of crude supply. It does not eliminate New Zealand's underlying vulnerability to shipping route disruption.
There remains a case for New Zealand to be able to refine domestically produced crude, which could meet approximately 15% of national demand. That ship may have sailed (pun intended), but the current crisis underscores the need to accelerate the transition to renewable energy sources, even if that transition does not immediately resolve our dependence on jet fuel for international travel.
