Only two fuel ships are expected to arrive in New Zealand in the next fortnight, according to the Government’s latest update, showing declining stocks.
As of midnight Sunday, New Zealand had 48.7 days’ cover of petrol, down from 49.9 days.
It had 46.5 days’ cover of diesel, up from 45.5 last Wednesday and 43.4 days’ jet fuel, down from 44.7 days.
The figures include stocks in New Zealand and shipments en route. The combined fuel stock stands at 46.6, about 10% down on two weeks ago when the Ministry of Business, Innovation and Employment reported 52 days’ stock cover.
The number of ships set to arrive does not include ships that are more than two weeks away. In 2022, a Cabinet paper cited Z Energy estimates that New Zealand would receive about 175 tankers arriving every year, or one every two days on average.
Fuel companies have said there are a healthy number of ships on the water or planned for later in April. This data will next be updated on the afternoon of March 30.
Finance Minister Nicola said the figures showed “normal” fluctuations in demand.
She said it was not concerning to only have two shipments arriving in the next fortnight, saying it was “within normal patterns of ship arrivals”.
She said fuel companies assured her they were expecting more ships.
MBIE will make an unscheduled clarification to today’s fuel data on Thursday morning after their data showed New Zealand could have just 11.3 days of diesel by Easter if current usage patterns persist.
The issue relates to how fuel stocks are calculated while ships are unloading them, which was not present in Wednesday’s update
The forecast decline in diesel stocks was picked up by Infometrics chief executive Brad Olsen.
He noted that with just 18.1 days’ worth of diesel in the country, New Zealand is on track to have stocks fall to just 11.3 days of the fuel by Easter Sunday.
Only one of the two ships heading to New Zealand carries any diesel, with the ministry saying it has 7.2 days’ cover.
Assuming the 18.1 days of diesel are consumed at normal levels between now and April 5, there will be 11.3 days’ cover by then – including fuel due to arrive in that period.
Olsen calculated the figures and said it was time for the Government to start considering fuel conservation measures.
“That crunch on diesel seems to be coming closer, quicker, and starts to become worrying given the importance of diesel to the productive economy,” Olsen said.
He wanted more certainty from the Government regarding what the country was going to do about potential fuel restrictions, which he said were looking more likely.
“Businesses are needing a stronger level of direction from the Government over whether their services are still going to be needed and whether they need to change those operations,” he said.
Willis confirmed she would give an update on New Zealand’s four fuel alert levels on Friday, outlining a framework of what would cause the country to move up the alert system. A move to Level 2 would result in the first demand restrictions being placed on fuel.
“We will give answers to some of the questions that New Zealanders are asking: what does that framework look like? What are the different phases of response that the Government envisages? What would be the triggers to move to additional measures? How would ministers assess that? How would they work with the industry to make those things happen?”
Willis said the announcement would show more detail and next steps. On Monday she said the Government had received advice on whether a law change would be necessary to trigger demand restrictions.
“There could be scenarios in which fuel orders for New Zealand are disrupted and that is one of the things we will assess,” she said.
On Monday, Willis joined Prime Minister Christopher Luxon and Associate Energy Minister Shane Jones to announce the Government would harmonise some fuel standards with Australia to encourage ships loaded with fuel to stop in New Zealand on their voyage.
“Countries that can access a wider range of shipments are better placed to keep fuel flowing,” Jones said.
Fuel refined to Australian standards was compatible with New Zealand vehicles, Jones said. The fuel also met safety and quality expectations, he added.
New Zealand would not, however, be following Australia’s lead and relaxing standards to allow higher-sulphur fuel, although the Government would monitor whether further changes to fuel specifications could open up further supply channels if necessary.
This arrangement could remain in place for up to 12 months if needed.
On Tuesday, the Government announced a temporary $50-a-week increase to the In-Work Tax Credit, which will go to a little over 140,000 households.
Luxon accepted the Government couldn’t alleviate pressure for everybody but claimed the support package targeted the most “squeezed middle”.
“These are the people that are doing it the toughest.”
Willis acknowledged some people would say it wasn’t enough but she reiterated her focus on controlling inflation.
“We are doing what we can do responsibly.”
The change will not increase the incomes of people on a benefit, which has been controversial.
It was estimated to cost $373 million for the year. Willis has promised the cost would be met within the Government’s operating allowance.
Labour leader Chris Hipkins said the Government’s support was a “start” but acknowledged “a lot of New Zealanders who won’t get anything” from today’s announcement.
“But for those who are getting a bit of extra support, I know they’ll welcome that.”
He said there was a question over what else the Government may have planned, including what support it could give to superannuants, students and other New Zealanders who don’t have children.