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When you’re running a business in Taranaki, global conflicts can feel far away. But right now, what’s happening in the Middle East-especially around Iran-is creating ripple effects that could reach your fuel bill, your supply chain, and even your customers’ spending habits. 

Let’s break down what’s happening, what it means for you, and what practical steps you build into your business plan for the year ahead. 

Why the Iran Conflict Matters to New Zealand 

According to the latest market intelligence from the Ministry of Foreign Affairs and Trade (MFAT), the Iran conflict is creating significant risks for global energy supply, particularly oil moving through the Strait of Hormuz-one of the world's most critical oil corridors. Disruption here means higher global fuel prices and broader inflationary pressure.ⁱ  

Even though New Zealand no longer imports crude oil from the Middle East, we do import refined fuel from countries highly dependent on Middle Eastern supply. That means our fuel prices are indirectly tied to what happens in the Gulf.ⁱⁱ  

And this isn’t just about fuel. MFAT’s report notes that geopolitical instability can push up borrowing costs, weaken the New Zealand dollar, and soften global demand for our exports.ⁱⁱⁱ  

“At $3.4bn, New Zealand’s total exports to the Persian Gulf region represent just 3.0 percent of our total exports. However, these exports are highly concentrated and dominated by dairy products into the UAE and Saudi Arabia, which are key markets for whole milk powder and butter. 

The region is also a key source for fertilisers, representing 22 percent of New Zealand’s fertiliser imports.”^iv 

In short: When the Middle East shakes, New Zealand feels it. 

South Korea’s Potential Fuel Export Ban: A Big Deal for New Zealand 

The latest reporting shows that South Korea-our single largest supplier of refined fuel, making up 48% of New Zealand’s imports-is considering banning all refined fuel exports if the conflict continues to disrupt the Strait of Hormuz.^v  

Why this matters: 

• Since Marsden Point closed, New Zealand imports 100% of its refined fuel 

• A governmentcommissioned report found that a 50% drop in fuel imports could cut New Zealand’s GDP by up to 1% 

• Officials are warning that things “will get serious by May” if the Strait remains blocked.^vi  

Fuel is the lifeblood of our transport, logistics, farming operations, construction activity-you name it. When supply tightens or prices spike, business costs rise fast. 

What This Means for Taranaki Businesses 

Here’s what rising geopolitical risk translates to on the ground: 

1. Higher Fuel Costs 

If global supply remains disrupted, elevated fuel prices are likely. MFAT reports that supply chain disruptions would “lead to elevated prices for fuel” across the economy.^vii  

This affects anyone who: 

• operates vehicles 

• runs heavy machinery 

• relies on freight providers 

• pays for staff or supplier travel 

In other words, almost every business. 

2. Rising Operating Costs 

Higher fuel prices flow through to: 

• shipping and freight 

• supplier pricing 

• inflation-driven wage pressure 

• general cost of doing business 

MFAT warns that inflationary impacts from an energy shock could spread widely.  

3. Potential Delays and Supply Chain Gaps 

With major Middle Eastern airspace restricted and shipping slowed, the availability of key inputs may be affected.^viii  

If you import materials or components-even indirectly-expect more variability. 

4. Softer Customer Spending 

Events like this can weaken global and local economic confidence, which usually reduces discretionary spending.^ix  

For Taranaki businesses selling consumer goods or services, this matters. 

Practical Planning Steps You Can Take Now 

1. Review Your Fuel Exposure 

Ask yourself: 

• How much does fuel contribute to your cost base? 

• Could a 10–20% increase be absorbed? 

• Are there efficiency gains you could make now? 

If you operate a fleet, this is a good time to: 

• optimise routes 

• service vehicles to maximise efficiency 

• review contracts with freight or delivery providers 

2. Build Contingency into Your Budget 

Set aside buffer funding for: 

• shortterm fuel price spikes 

• supplier cost increases 

• unexpected delays 

Even a small contingency can reduce stress if volatility persists. 

3. Talk to Your Suppliers Early 

If you rely on imported fuel, components, or shipping, ask: 

• Are they anticipating delays or cost increases? 

• Can they offer visibility on future pricing? 

• Is there a local alternative if needed? 

Supply chain communication is one of your most powerful tools. 

4. Revisit Your Pricing Strategy 

If costs rise, you may need to adjust pricing. 

Look for: 

• phased price changes 

• bundling or valueadd offers 

• opportunities to lock in longterm supply at stable prices 

A clear, proactive pricing conversation is better than a lastminute shock. 

5. Strengthen Cashflow Resilience 

Global instability tends to slow payments and soften sales. 

Consider: 

• tightening debtor management 

• improving invoicing turnaround 

• minimizing nonessential spending 

A resilient cashflow gives you breathing room. 

6. Consider Holding More Key Stock on Hand If supply chains tighten or delivery times become less predictable, carrying a little more stock of critical items may help reduce disruption. This won’t suit every business, but it’s worth thinking about for products or materials that are essential to your operations and hard to replace quickly. 

 Consider: 

• Which items would cause the biggest disruption if they were delayed? 

• Do any of these have long lead times or limited local availability? 

• Could a modest increase in stock levels give you more certainty over the next few months? 

The goal isn’t to overcommit cash unnecessarily, it’s to identify where a small buffer could protect your ability to keep trading smoothly. 

 Stay Informed, Stay Ready 

The Iran conflict and potential South Korean export ban may sound alarming, but with the right preparation, your business can navigate this uncertainty with confidence. 

At Unlimit, our goal is to keep things clear and practical so you can focus on what really matters-running your business well. If you’d like help modelling scenarios, reviewing budgets, or planning for different fuel price impacts, we’re here to support you. 

Let’s tackle this together. 

References:

https://www.mfat.govt.nz/en/trade/mfat-market-reports/trade-and-economic-implications-of-the-iran-conflict