2026 Fuel Prices & Security of Supply

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#3487756 5-May-2026 14:37

wellygary:

That doesn't gel with this from the IEA though,

there's around 4 billion barrels sloshing around OECD countries, which is 500 days @ 8mb/d.... Then there is China....

" Global observed oil stocks were 8 210 mb in January, their highest level since February 2021. The OECD accounted for 50%, Chinese crude stocks 15%, oil on water 25%, with the remainder in other non-OECD countries."
https://www.iea.org/reports/oil-market-report-march-2026

I guess time will tell...

fastbike

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#3487767 5-May-2026 15:40

wellygary:

That doesn't gel with this from the IEA though,

there's around 4 billion barrels sloshing around OECD countries, which is 500 days @ 8mb/d.... Then there is China....

" Global observed oil stocks were 8 210 mb in January, their highest level since February 2021. The OECD accounted for 50%, Chinese crude stocks 15%, oil on water 25%, with the remainder in other non-OECD countries."
https://www.iea.org/reports/oil-market-report-march-2026

If only it were that simple. The IEA tone has changed by the time they wrote their April report - the introduction ends thus (emphasis mine)

IEA:
The prospects for a lasting negotiated settlement to the conflict remain unclear at this stage. In this Report, we present a forecast that assumes a resumption of regular deliveries of oil and gas from the Middle East to international markets by mid-year, although not back to pre-conflict levels. We recognise that this scenario could prove too optimistic, considering the high degree of uncertainty over how the situation may develop. We also present an alternative case where risks to energy production and trade in the Middle East remain high due to a prolonged conflict (see Strait Down – Stocks Draw as the Loss of Hormuz Flows Tightens Balances). In this case, energy markets and economies around the world need to brace for significant disruptions in the months to come.

Otautahi Christchurch

wellygary

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#3487776 5-May-2026 16:25

fastbike:

IEA:
The prospects for a lasting negotiated settlement to the conflict remain unclear at this stage. In this Report, we present a forecast that assumes a resumption of regular deliveries of oil and gas from the Middle East to international markets by mid-year, although not back to pre-conflict levels. We recognise that this scenario could prove too optimistic, considering the high degree of uncertainty over how the situation may develop. We also present an alternative case where risks to energy production and trade in the Middle East remain high due to a prolonged conflict (see Strait Down – Stocks Draw as the Loss of Hormuz Flows Tightens Balances). In this case, energy markets and economies around the world need to brace for significant disruptions in the months to come.

I think this is probably as much as we can safely say about things at the moment,

This came out from JPM last week, which tends to indicate we've probably got another couple of months until things start to get to "squeaky bum" time... and then we start to crimp refinery operations, but its not a total calamity for at least another 6 months after that

.. FWIW US Mid terms are in November, and this pretty much needs to be wrapped up by then as gas at $4+/gallon will get Reps crucified...

JPNZ

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#3487779 5-May-2026 16:31

JPNZ:

Our NPD price for the period 29-4-26 to 5-5-26 is down another 22 cents. Diesel is $2.56 per litre incl gst

In the interest of keeping this going Diesel price is up 40 cents for 6-5-26 to 12-5-26 to $2.96 Per Litre

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Handle9

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#3487815 5-May-2026 17:58

wellygary:

I think this is probably as much as we can safely say about things at the moment,

This came out from JPM last week, which tends to indicate we've probably got another couple of months until things start to get to "squeaky bum" time... and then we start to crimp refinery operations, but its not a total calamity for at least another 6 months after that

.. FWIW US Mid terms are in November, and this pretty much needs to be wrapped up by then as gas at $4+/gallon will get Reps crucified...

Western/developed countries are pretty much ok for petrol and diesel. There are some inflationary aspects but really this isn't a massive crisis as they can afford to pay a bit more to access the available supply. The bigger issue is in the developing world and countries which are dependent on gulf LNG.

The bigger impacts are in South Asia and South East Asia where the economies don't have the money to absorb large price rises. Winter in Europe would be the other big crunch point as they are very dependent on Qatar LNG after the Russian mess.

fastbike

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#3487987 6-May-2026 09:23

John Campbell spoke to Gero Farruggio from Rystad Energy on Morning Report today. Audio is here

https://www.rnz.co.nz/national/programmes/morningreport/audio/2019033839/what-nz-s-deal-with-singapore-could-mean-for-fuel-supply

Chat GPT summarised it for me (I'm too lazy to do it myself ? but it is an accurate synopsis) Highlighting is by the bot, not me - but crikey it nails it.

GPT:

Why Singapore matters

Singapore is a major refining hub.
NZ depends on it for a significant share of petrol, diesel, and jet fuel.
Without domestic refining, NZ is highly exposed to international shipping and refining capacity.
Expert commentary (core of the segment)

The deal is helpful diplomatically and symbolically, but:

It does not create new fuel supply.
It mainly ensures NZ won’t be cut off by Singapore policy decisions.
In a real global shortage:

Market forces still dominate (price spikes, competition for supply).
Private companies, not governments, control most fuel distribution.
Limitations highlighted

The agreement:

Doesn’t guarantee availability if refineries can’t produce enough.
Doesn’t control prices.
Doesn’t solve shipping bottlenecks.
So it improves certainty of cooperation, not physical resilience.
Broader takeaway

NZ’s vulnerability comes from:

Geographic isolation
Reliance on imported refined fuel
The deal is one piece of a wider strategy, but not a silver bullet for fuel security.

Otautahi Christchurch

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pdh

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#3488164 6-May-2026 16:34

fastbike:

... but it is an accurate synopsis) Highlighting is by the bot, not me - but crikey it nails it.

GPT:

Why Singapore matters

The deal is one piece of a wider strategy, but not a silver bullet for fuel security.

It is indeed true - and relevant... but surely is just the profoundly obvious downside of global trade ?

If you won't, or can't, make it yourself - you are open to serious disruption if something outside of your control puts an obstacle in your way to obtaining it.

The same could be said for solar panels, transformers, pharmaceuticals, automobiles, aircraft, X-ray machines (the list is almost infinitely long) and the parts thereof.

I'm more worried that NZ is on a path to do - not nothing - but less and less, to give us trade goods to exchange for stuff we can't/won't make.

We're a long way from being Cuba - but comparing NZ in 2026 with the paradigm shift under Lange/Douglas - when NZ woke up to the fact that we had to find things to sell and people to sell them to...
There seems to be zero awareness that it's bloody important to have NZ stuff on the global trading table.
We've deprecated foreign-student education & wool production.
We're luke-warm on film production and sailing events - as direct money-earner & a focus for tourist attention.
We're pretty off-hand and rude about tourists in general.
We're doing our best to make timber & food production uneconomic (through energy pricing & regulation).
And we are having zero public discourse on how we plan to earn enough to keep us in the manner to which we have become accustomed.

All of the discussion about the current fuel crisis had focused on when mum's going to be unable to drive the kids to school.
Not much concern about getting our butter to market.
Which is more important ?

wellygary

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#3488168 6-May-2026 16:52

"Without domestic refining, NZ is highly exposed to international shipping and refining capacity.'

But even if we had 100% domestic refining capacity we would still have to source the right sort of crude to feed it..

As a "tiny" demand speck, its probably better to be hunting refined product, which there is a much larger supply of, rather than raw ( appropriate) crude, which I suspect would have fewer suppliers ..

The Mega refineries in Asia can probably handle blending different crude sources much more easily than a tea pot refiner down here could do..

Handle9

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#3488177 6-May-2026 17:09

wellygary:

"Without domestic refining, NZ is highly exposed to international shipping and refining capacity.'

But even if we had 100% domestic refining capacity we would still have to source the right sort of crude to feed it..

As a "tiny" demand speck, its probably better to be hunting refined product, which there is a much larger supply of, rather than raw ( appropriate) crude, which I suspect would have fewer suppliers ..

The Mega refineries in Asia can probably handle blending different crude sources much more easily than a tea pot refiner down here could do..

This is the point right? If you don't have domestic extraction domestic refining isn't pointless but it's not that valuable.

We haven't really found domestic sources of crude oil for many years, despite significant exploration, so it doesn't really serve a useful purpose refining in NZ.

deepred

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#3488181 6-May-2026 17:19

Handle9:

wellygary:

"Without domestic refining, NZ is highly exposed to international shipping and refining capacity.'

But even if we had 100% domestic refining capacity we would still have to source the right sort of crude to feed it..

As a "tiny" demand speck, its probably better to be hunting refined product, which there is a much larger supply of, rather than raw ( appropriate) crude, which I suspect would have fewer suppliers ..

The Mega refineries in Asia can probably handle blending different crude sources much more easily than a tea pot refiner down here could do..

This is the point right? If you don't have domestic extraction domestic refining isn't pointless but it's not that valuable.

We haven't really found domestic sources of crude oil for many years, despite significant exploration, so it doesn't really serve a useful purpose refining in NZ.

Even with the offshore exploration ban being repealed, it likely won't make much difference if any at all.

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Handle9

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#3488183 6-May-2026 17:21

deepred:

Handle9:

This is the point right? If you don't have domestic extraction domestic refining isn't pointless but it's not that valuable.

We haven't really found domestic sources of crude oil for many years, despite significant exploration, so it doesn't really serve a useful purpose refining in NZ.

Even with the offshore exploration ban being repealed, it won't make much difference if any at all.

If they found something it might. The problem is the haven't found anything much for decades.

The ban was largely performative as was the repeal.

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deepred

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#3488185 6-May-2026 17:26

Handle9:

deepred:

Handle9:

This is the point right? If you don't have domestic extraction domestic refining isn't pointless but it's not that valuable.

We haven't really found domestic sources of crude oil for many years, despite significant exploration, so it doesn't really serve a useful purpose refining in NZ.

Even with the offshore exploration ban being repealed, it won't make much difference if any at all.

If they found something it might. The problem is the haven't found anything much for decades.

The ban was largely performative as was the repeal.

Even with today's geological and mapping advances, too.

HarmLessSolutions

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#3488190 6-May-2026 17:48

Handle9:

This is the point right? If you don't have domestic extraction domestic refining isn't pointless but it's not that valuable.

We haven't really found domestic sources of crude oil for many years, despite significant exploration, so it doesn't really serve a useful purpose refining in NZ.

The last refining of NZ sourced crude oil was at the Peak refinery near Port Taranaki supplied by nearby wells discovered in 1865 but that refinery closed in 1972. Marsden Point was designed to process imported heavy crude with New Zealand's own production being lighter 'condensate' type crudes.

The only potential hydrocarbon reservoir known is the Karewa field offshore of Raglan but it is only expected to contain a couple of year's gas supply at current consumption rates. I've seen maps showing historical seismic data and the coverage of the Taranaki area at least has saturation cover both on and off shore. The only real promise of significant hydrocarbon finds for NZ is in the Great Southern Basin off the lower South Island but the geographical isolation and severe sea conditions make it unpalatable to pursue at this point. The closure of the Maui field later this year may influence gas prices sufficiently to stimulate more exploratory drilling but that's far from certain at this point in time.

The current fuel crisis is more about New Zealand being caught with its pants down regarding a 'just in time' supply chain not providing a sufficient buffer to supply disruptions. This won't be the last such oil disruption we will see but hopefully it will be a wake up call in regards to reducing our reliance on fossil fuels, and things are going to tighten up significantly in the coming months so the lesson will be well impressed on us.

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JPNZ

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#3490174 12-May-2026 16:28

JPNZ:

JPNZ:

Our NPD price for the period 29-4-26 to 5-5-26 is down another 22 cents. Diesel is $2.56 per litre incl gst

In the interest of keeping this going Diesel price is up 40 cents for 6-5-26 to 12-5-26 to $2.96 Per Litre

Diesel price down 22 Cents a litre 13-5-26 to 19-5-26 now $2.74 a litre

Panasonic 65GZ1000, Onkyo RZ730, Atmos 5.1.2, AppleTV 4K, Nest Mini's, PS5, PS3, MacbookPro, iPad Pro, Apple watch SE2, iPhone 15+

fastbike

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#3490228 12-May-2026 16:43

JPNZ:

Diesel price down 22 Cents a litre 13-5-26 to 19-5-26 now $2.74 a litre

Enjoy it.

Otautahi Christchurch

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