The global fuel supply disruption flowing from the Middle East conflict is already hitting our hospitality businesses — and we’ve been working hard to make sure the impacts are being heard at a government level.
In early April, we ran a member snapshot survey to understand where things were at. Two thirds of respondents reported reduced customer numbers, nearly half reported reduced spend per customer, and over 60% were already seeing increased fuel and delivery costs. As we know, these pressures are landing on top of margins that are already too tight.
We’ve been providing our feedback to feedback – both the current impacts we are seeing, as well as feedback on the Fuel Response Plan. This is the framework that will prioritize fuel supply and guide how fuel is allocated if disruption deepens.
We are heavily dependent on fuel supply indirectly
While hospitality isn’t generally a heavy direct user of fuel, we’re deeply dependent on it indirectly. Every delivery that arrives at your back door, every supplier run, every staff member driving a shift — all of it relies on fuel flowing through the system. As we’ve already started to see, when that’s disrupted, we feel it immediately.
Our feedback makes the case that food supply chains — including the distributors, wholesalers, and specialty suppliers we all rely on — need to be protected within the government’s prioritisation framework. Food distribution needs to sit within those protected bands, and the definition needs to be broad enough to cover the full network of suppliers our industry depends on.
Of course, for hospitality workforce mobility is also key and we have raised this. Many of our team members rely on being able to get to work, particularly in regional areas and across shift-based rosters.
We’ll continue to keep you updated
We’re continuing to monitor the situation and staying engaged with government. If disruption escalates and prioritisation bands come into effect, we want to make sure hospitality is recognised not just as a business sector, but as an enabling part of the wider economy — one that supports tourism, employment, and community life right across the country.
We’ll keep you updated as things develop. In the meantime, if you’re experiencing significant impacts, keep records of cost increases, supplier changes, and shifts in customer behaviour — this kind of evidence strengthens the case we’re making on all our behalf and please do feel free to get in contact.
UPDATE:
On 11 May, 2026 the Government provided details of changes to the Fuel Response Plan. This aligns with the Association’s submission – signalling that, in a fuel disruption or shortage scenario (move to Phase 4), the Government wants the system to stay flexible enough that essential parts of the economy — including food distribution and hospitality supply chains — can keep operating. Read the Government Press release here.
More information:
Middle East conflict: what are the impacts we’re seeing now?
Middle East conflict: How Kiwi hospitality operators can mitigate rising costs