Fuel Price Increases & Supply Pressures - The Transport Flow-On Effects for NZ and Australia
"Filling up at the petrol station is definitely becoming painful" - my wife said to me as we filled up our car yesterday "anything you think can realistically be done in the short term...or long term for that matter?"
Good question and one that is hard to answer as there are so many moving pieces. We had been in France a few weeks back and had seen fuel at well over 2 euro a litre - something we had never seen before.
New Zealand and Australia are both increasing prices and also facing fuel shortages - supply and demand.
It's clear that the current fuel price environment is creating real pressure across transport networks in both New Zealand and Australia. It is also clear that it's worth unpacking what the flow-on effects actually look like from a transport planning perspective. Here's a quick snapshot below.
What's driving it.
Unless you haven't been watching the news, you will know what is causing this.
Global oil markets have tightened significantly in 2026, with Middle East supply disruptions affecting shipping lanes and pushing crude and refined product prices sharply higher. Both NZ and Australia are heavily import-dependent for refined fuel - NZ has had no domestic refining capacity since Marsden Point closed in 2022, and Australia operates just two remaining refineries. That structural exposure means global price signals transmit quickly and directly into local transport costs.
The freight and supply chain picture.
Road freight operators are absorbing significant cost increases, with those costs flowing through to freight rates and ultimately to consumers. In Australia, Maersk introduced an intermodal fuel surcharge from mid-March, lifting landside transport costs materially. Container terminal delays, blank sailings, and equipment imbalances are compounding the pressure. For supply chains that were already operating lean, the margin for disruption is narrow.
As a quick point, while EV trucks are a way for the future, currently they make up less than one percent of the New Zealand fleet - making it difficult to survive without diesel.
Regional and rural exposure.
This is where things get more interesting. The effects are not evenly distributed. Regional and rural communities - where diesel dependency is highest and public transport alternatives are limited or absent - are absorbing a disproportionate share of the impact.
This is particularly relevant for freight-intensive primary industries and communities already managing cost-of-living pressures.
The public transport response.
One of the more interesting signals from the data is the accelerating shift to public transport. Auckland recorded 2.25 million PT trips in a single week - a seven-year high.
Mode shift is occurring in response to price signals in a way that has historically been difficult to achieve through planning interventions alone. The challenge will be whether networks have the capacity and reliability to sustain and build on that shift.
Short-term responses underway.
Governments on both sides of the Tasman are actively working through near-term options -including fuel excise adjustments, alignment of fuel specifications to broaden import options, and relief for heavy vehicle operators. These are sensible demand-side and supply-side levers available within existing frameworks, and they are being deployed pragmatically given the speed of the situation.
The longer-term opportunity.
Beyond the immediate response, this environment opens an important conversation about structural resilience in transport systems. There are well-established levers worth examining more closely - fuel security strategy and strategic reserve policy, demand management frameworks, accelerated investment in public transport capacity and reliability, freight network efficiency improvements, electric and alternative fuel fleet transition, and land use planning that reduces trip length and vehicle dependency over time. None of these are new ideas, but the current context makes the case for them more tangible.
For transport planners and advisors, this is both a sad and a useful moment - not just to respond to the immediate pressure, but to use it as a lens for longer-term system resilience thinking.
Here is hoping for a fast end to the war, for people to be safe, and for supply chains to get back to normal. And at the same time, thinking about what the current or new world may mean for transport planning.
Andrew
#TransportPlanning #FuelSecurity #PublicTransport #FreightLogistics #SupplyChain #NewZealand #Australia #TransportPolicy #Infrastructure #SystemResilience #KAAdvisory
Transit Trends · Andrew Collings, KA Advisory. Read and comment on the original on LinkedIn.
Planning a development? Find out in minutes whether you need a transport assessment with KA PreCheck™, or estimate your trips with the free KA Traffic Estimator™.