It is not yet a trend. Brent has since jumped to a six-month high, diesel cover has fallen, container rates are rising again, and the Reserve Bank decides on the OCR on Wednesday.
The risk has moved from whether fuel is available to what the next cost step will be, and who absorbs it.
HSCM Solutions Read: A flat weekly price is a lagging signal. The crude move that followed has not reached the pump data yet.
This Week in 30 Seconds
| Signal | What changed | Commercial implication |
|---|---|---|
| Diesel price | MBIE adjusted retail diesel 321.70 c/L, up 0.79c (week ending 16 October) | Price growth has slowed. It has not reversed. |
| Diesel cover | 46.3 days as at 18 October, down from 50.6. Ships inbound 9, down from 11 | The buffer has narrowed. Less fuel is on the water. |
| Crude | Brent Dec settled US$116.72 on 23 October, up 6.2% for the week | The rise falls after the latest MBIE window. Expect pressure on the next two prints. |
| Exchange rate | NZD/USD 0.56890 (RBNZ B1, 23 October) | A US$100,000 invoice costs NZ$1,984 less than a week earlier. |
| Freight | Drewry WCI US$4,585, up 2.2%. Port of Auckland FAF rises to NZ$20.00 on 6 November | Cost pressure is rebuilding. These are separate cost lines. |
| Rates | Q3 CPI 3.7%. OCR decision 2pm, 28 October, currently 2.75% | Financing cost on inventory is the next exposure. |
| Trade | NZ-India FTA in force 20 October. Certificate of Origin required | A real sourcing opportunity, but only with the paperwork. |
HSCM Solutions Supply Chain Stress Index
Supply conditions are manageable. Cost volatility is not. Retail diesel has paused, but crude, freight and funding costs are all pointing up. The index remains Elevated because rising upstream costs and financing risks outweigh physical fuel availability, which is manageable but narrower than a fortnight ago.
Not every lever is moving the wrong way. The stronger NZD helps on US dollar invoices. It is small relative to the other moves.
Commercial Signal
A slower price rise is not a lower price.
Diesel is still 135.01c/L above the pre-conflict 186.69, a rise of 72.3%. A business that read the 0.79c as the peak, and priced customer work on that basis, is carrying the risk if crude feeds through.
The practical question for each fuel-exposed contract is whether the recovery mechanism resets weekly, monthly or not at all.
This Week’s Number
| Diesel cover (days) | 11 October | 18 October |
|---|---|---|
| In-country | 27.2 | 29.8 |
| On ships within EEZ | 6.4 | 1.3 |
| On ships outside EEZ | 17.0 | 15.1 |
| Total | 50.6 | 46.3 |
| Fuel ships inbound | 11 | 9 |
More diesel is on shore. Less is close to arriving, and only one ship is inside the EEZ. This is a narrower pipeline, not a shortage. A smaller inbound pipeline leaves less flexibility if shipping delays or another supply disruption occur.
MBIE’s total excludes the 87.5 million litre strategic diesel reserve at Marsden Point. MBIE’s stock update moves to Thursdays from 29 October.
Leading Signals vs Current Reality
| Leading signal | Current reality |
|---|---|
| Brent rose 6.2% in the week to 23 October | MBIE’s latest diesel print covers the week to 16 October and rose 0.79c. The two periods differ. |
| IEA agreed on 15 October to accelerate the remaining stock releases, including over 20 million barrels of diesel | Announced is not delivered. No new volume has been confirmed since. |
| Reports that Russia has partly reopened diesel exports | The formal producer ban runs to 31 October. No successor decree has been confirmed. |
| NZD strengthened 1.1% | Freight indices and port charges rose over the same week. |
| Annual CPI eased to 3.7% | Banks still expect an OCR increase. |
HSCM Solutions Read: Treat the week’s price data and the week’s crude data as two different clocks.
1. Fuel, Energy & FX
Diesel paused. Petrol did not.
MBIE’s adjusted retail diesel price reached 321.70 c/L for the week ending 16 October, up 0.79c from 320.91. Weekly changes since 4 September have run +5.1c, +15.1c, +21.0c, +8.9c, +3.8c and now +0.8c.
| Observation | Adjusted retail diesel |
|---|---|
| 4 September | 266.89 c/L |
| Week ending 9 October | 320.91 c/L |
| Week ending 16 October | 321.70 c/L |
| Change since 4 September | +54.81 c/L |
| Change since pre-conflict (186.69) | +135.01 c/L (+72.3%) |
Adjusted retail regular petrol rose faster, up 7.30c to 357.93 c/L. Source: MBIE. Prices include GST and exclude Road User Charges. MBIE’s series is a national average, not a fleet’s contracted price. HSCM Solutions did not obtain a diesel board price for this issue.
Crude is the next test
Brent December settled at US$116.72 on 23 October, up US$6.86 for the week and the highest settle since 29 April, according to CNBC. WTI settled at US$103.27. The move was linked to reports that the US could resume strikes on Iran.
MBIE’s importer cost series follows Singapore product prices and the exchange rate. The week to 23 October, due from MBIE on 28 October, is the first print that can show this move.
Supply measures are announced, not delivered
On 15 October the IEA said about 330 million barrels had been released and agreed to accelerate the remainder, including more than 20 million barrels of diesel. IEA director Fatih Birol said on 20 October the agency is ready to coordinate a further action. No new volume or delivery timing has been confirmed.
Russia’s producer diesel export ban is formally in place to 31 October. Trade reports describe a partial reopening, but HSCM Solutions did not identify a decree confirming it in the sources reviewed.
Hormuz remains severely constrained
The Joint Maritime Information Center rated the threat at “severe” in its advisory to 25 October. Kpler, quoted by CNBC, said Middle East crude flows have recovered while product flows remain about 50% below pre-war levels. Product flows are what matter for New Zealand diesel.
Claims by Iran’s Revolutionary Guard of multiple tanker strikes on 21 and 22 October have not been confirmed by UKMTO, CENTCOM or the JMIC, and are not relied on here.
The kiwi gives a little back
The RBNZ B1 fix on 23 October was 0.56890, against 0.56255 a week earlier. The TWI was 64.51. At 0.56890, a US$100,000 invoice equates to about NZ$175,778, down NZ$1,984 from NZ$177,762, before bank charges or hedging.
That is a real saving on US dollar purchases. It is a different cost line from freight, port charges or fuel, so it should not be netted off against them without a shipment-level landed-cost calculation.
HSCM Solutions Read: Keep fuel assumptions at current levels or higher until the next two MBIE prints are in. Do not lock in lower pricing on the strength of one flat week.
2. Freight, Ports & Network
Global container rates rose again
Drewry’s World Container Index rose 2.2% to US$4,585 per 40-foot container on 22 October, a second consecutive weekly gain. Drewry expects a slight further rise next week, with eight Asia-Europe blank sailings announced. The Intra-Asia Container Index edged up US$6 to US$1,459.
Neither index measures New Zealand lanes. They show global direction only. NZ shipment quotations remain the benchmark.
Auckland’s fuel adjustment steps up again
Port of Auckland’s fuel adjustment factor for a full import or export container is NZ$17.50 from 9 October and rises to NZ$20.00 on 6 November, a further 14.3%. Since 4 September, when it was NZ$15.00, the cumulative rise is 33.3%.
This is an increase in one port charge, not in total freight cost. The 6 November step was set before this week’s crude rally and will not reflect it. NZ Couriers’ domestic variable fuel factor is 14.30%, unchanged since 19 October.
HSCM Solutions did not obtain NZ-specific surcharge notices from the major container lines, or updates from other NZ ports, Cook Strait ferries or KiwiRail this cycle. Check carrier advisories directly before relying on rate assumptions for pre-Christmas shipments.
HSCM Solutions Read: Compare total delivered cost per shipment. Ocean rate, port charge, inland transport and currency each move on their own schedule.
3. Demand, Manufacturing, Trade & Dairy
The fuel shock is now in the trade data
Stats NZ reported September goods imports of NZ$8.4 billion, up 18% on a year earlier, and a monthly deficit of NZ$2.0 billion. Petroleum imports were NZ$1.2 billion, up NZ$608 million (96%), which Stats NZ attributed predominantly to higher prices.
Services are barely growing
The BNZ-BusinessNZ Performance of Services Index was 50.9 in September, from a revised 51.0 in August. New orders were 52.6, employment 49.8. Against the manufacturing PMI of 56.5, production is running ahead of services activity. Stock should follow confirmed orders, not the PMI.
Dairy strengthens
The Global Dairy Trade auction on 20 October lifted the price index 2.5%, the largest rise since February. Whole milk powder rose 4.4% to US$3,760 per tonne and skim milk powder 3.4% to US$3,975. Cheddar fell 7.4%. Fonterra’s 2026/27 forecast midpoint was lifted to NZ$9.50/kgMS on 21 September, before this auction.
NZ-India FTA: confirmed facts
The agreement took effect on 20 October. NZ Customs states that all tariffs have been removed for goods of Indian origin from entry into force, with no phase-in on the NZ side.
Preference is not automatic. Customs requires a Certificate of Origin, and self-declaration is not yet available. A proof of origin is valid for 12 months and can cover multiple shipments of identical goods. Importers must keep records for seven years.
Media figures on peak tariffs and numbers of tariff lines are not confirmed by official sources and are not used here.
HSCM Solutions Read: Tariff relief only reaches landed cost if the origin paperwork is in hand before the goods arrive. Check supplier readiness first.
4. Rates & Compliance
CPI fell, but not in the direction that matters most
Q3 CPI rose 0.7% for the quarter and 3.7% for the year, down from 4.1%. That was below forecasts from the RBNZ (3.9%), ANZ (3.8%) and Kiwibank (4.0%), and in line with Westpac (3.7%). Tradables rose 4.3% and non-tradables 3.3% on the year.
Petrol fell 6.5% in the quarter but is up 19.1% on the year. ASB expects annual CPI to reach 4.5% by Q4 on fuel, airfares and construction costs.
OCR, 2pm Wednesday 28 October
Policy. The OCR is 2.75% after 25 basis point increases in July and September. This is a Monetary Policy Review, with the next decision on 9 December.
RBNZ signals. After the September increase, Governor Anna Breman signalled a possible pause. The September projections pointed to an eventual peak of about 3.25%, according to Westpac. Since then, higher oil, firmer global rates and a weaker NZD have been highlighted by Westpac and ING.
Market pricing. ASB’s Mark Smith put a 25 basis point increase at roughly 90% priced in. Bloomberg-cited swap pricing was about 85%. HSCM Solutions did not obtain exact OIS levels.
Bank views. Westpac, ASB, ANZ and ING expect a 25 basis point increase to 3.00%. ANZ then expects a pause in December. ASB expects further increases in December and February. The decision falls ten days before the 7 November general election.
HSCM Solutions planning. Test inventory and purchasing decisions at both 2.75% and 3.00%. This is a planning approach, not a prediction.
For a business carrying NZ$5 million in inventory, 0.25 percentage points on its effective financing rate is about NZ$12,500 a year, assuming the full balance is financed and the change is passed through.
US lamb safeguard
The USITC held its injury hearing on 16 October. A determination is due by 13 November. No measure should be assumed.
What Smart Operators Are Doing Now
- Hold fuel surcharge assumptions until the 28 October and 4 November MBIE prints. Confirm each carrier’s reset frequency and index.
- Request certificates now from Indian suppliers. Identify tariff lines and the saving per unit before changing orders.
- Run financing scenarios at 2.75% and 3.00% on stock held more than 90 days.
- Check Christmas cargo-ready dates and 6 November port charges against shipments in transit.
- Price new customer work on current fuel and freight, not on last week’s pump price.
HSCM Solutions Base Case
Costs stay elevated. Pump prices catch up with crude.
| Scenario | What it looks like | Planning response |
|---|---|---|
| Base | Retail diesel resumes rising as Brent feeds through. Cover stays in the mid-40s. Freight edges up. | Keep current fuel and freight assumptions. |
| Relief | Delivered IEA and Russian volumes lift cover. Hormuz product flows recover. | Review surcharge reductions with carriers. |
| Stress | Renewed US strikes on Iran or deeper Hormuz disruption. Cover keeps falling. | Secure critical supply, bring forward key orders. |
| Strengthens the base case | Weakens it |
|---|---|
| Brent holds above US$110 | Brent falls back below US$100 |
| 28 October and 4 November MBIE prints rise | MBIE prints stay flat or fall |
| Inbound ships fall below 9 | Cover rebuilds above 50 days |
| OCR rises to 3.00% | OCR on hold with softer language |
Key triggers: OCR (28 October), MBIE cover and ships inbound (29 October), Russian ban decision (31 October).
These are planning scenarios, not price or monetary policy forecasts.
Dates to Watch
| Date | Event | Why it matters |
|---|---|---|
| 27 October | RBNZ B1 exchange rate release, 3pm | First fix since 23 October. |
| 28 October | MBIE weekly fuel prices | First print to show the Brent move. |
| 28 October | RBNZ OCR decision, 2pm | Financing cost. |
| 29 October | MBIE fuel stocks (now Thursdays) | Cover and ships inbound. |
| 31 October | Russian producer diesel ban expiry | Diesel supply. |
| 3 November | Global Dairy Trade auction | Export prices. |
| 6 November | Port of Auckland FAF to NZ$20.00 | Landed cost. |
| 7 November | General election | Policy risk. |
| 13 November | USITC lamb determination due | Export risk. |
| 9 December | Next OCR decision | Financing. |
The Week in Context
Last week’s brief was titled “Fuel Supply Is Improving. Your Costs Are Not Falling.”
This week the supply picture softened slightly, retail diesel paused, and crude moved the other way. The stronger kiwi helped at the margin. Freight and port charges did not.
Better supply and slower price rises are welcome. They do not yet mean cheaper operations.
Read the right clock. Price the risk before it arrives.
Sébastien Mallevialle CSCP | HSCM Solutions
sebastien.mallevialle@hscmsolutions.com |
hscmsolutions.com
Published every Monday | Issue #23 | 27 October 2026 | Figures current to latest available data as at 26 October 2026 | Next: Monday, 2 November 2026
This publication is provided for general informational purposes only and reflects the author's independent analysis of publicly available information at the time of writing. It does not constitute financial, legal, tax, investment, or professional advice. Readers should seek independent professional advice before making decisions based on this content. While reasonable care has been taken in preparing this publication, HSCM Solutions makes no representations or warranties regarding its accuracy, completeness, or suitability for any particular purpose and accepts no liability for any loss arising from reliance on this publication.
Sources: MBIE weekly fuel price monitoring and fuel stock updates · RBNZ exchange rates and OCR publications · Stats NZ (CPI, overseas merchandise trade) · BNZ-BusinessNZ · Drewry · Port of Auckland · NZ Couriers · IEA · Global Dairy Trade · Fonterra · NZ Customs and MFAT · USITC · CNBC · Joint Maritime Information Center · bank economist commentary via interest.co.nz and 1News