Luxon Joins World Leaders in Push to Reopen the Strait of Hormuz as Fuel Prices Surge

Prime Minister Christopher Luxon has joined a virtual meeting of approximately 40 to 50 world leaders pushing for a diplomatic solution to the crisis in the Strait of Hormuz, a waterway whose closure has sent petrol and diesel prices surging to record levels for New Zealand motorists.

The meeting, chaired by France and Britain, brought together leaders from Europe, Asia, and the Middle East to discuss ways of reopening the strait, through which roughly one-fifth of the world’s oil and liquefied natural gas normally passes. In a significant development during the talks, Iran announced it would reopen portions of the waterway — though Luxon was quick to stress uncertainty remained.

“Freedom of navigation, international law, stable and predictable trade routes are essential to our economy,” Luxon said in a statement posted to social media following the session. “This still remains a very fragile situation and it is an important moment to work together with partners.”

The Strait of Hormuz is a narrow strip of water sitting between Iran to the north and Oman to the south. Iran effectively closed the route to non-Iranian vessels after United States and Israeli airstrikes began on February 28, bringing shipping traffic through one of the world’s most critical maritime chokepoints to a near standstill. The impact on global oil markets has been swift and severe. Brent crude prices, which sat around US$70 a barrel before the crisis, surged to peaks above US$119 a barrel in March.

For New Zealand, the consequences have landed hard and fast. Petrol prices rose 18.6 percent between February and March 2026 — the largest monthly increase since records began in July 2011. Diesel surged even more sharply, rising 42.6 percent over the same period. In dollar terms, 91 unleaded rose by $1.04 per litre, equivalent to a 40 percent increase, while diesel went up by $1.90 per litre. Westpac data showed spending on fuel rose 15 percent compared to the same period the previous year, even as motorists purchased six to eight percent less fuel per transaction. New Zealanders are paying dramatically more to go considerably less far.

The disruption goes deeper than the bowser. Most of New Zealand’s fuel comes from refineries in South Korea and Singapore, which in turn import unrefined crude from across the Middle East, much of it originally routed through the Strait of Hormuz. When the waterway closes, the supply chain tightens, shipping costs rise, and those costs flow directly into prices at New Zealand service stations. The country has virtually no capacity to insulate itself from that chain of events.

Nicola Willis, the Finance Minister, has previously warned of a worst-case scenario for the New Zealand economy should the Middle East conflict drag on. The Government has flagged some cost of living relief measures but ruled out a fuel tax cut, a decision that has drawn criticism from opposition parties and transport advocates who argue Kiwi families and businesses cannot absorb fuel costs at current levels indefinitely. Parliament passed emergency legislation in early April providing a temporary payment to certain workers most exposed to the fuel price spike.

New Zealand was among 35 nations to sign a joint statement supporting safe passage through the strait, alongside Australia, Canada, South Korea, and a number of European nations. The Ministry of Foreign Affairs and Trade said participation was in line with the country’s longstanding commitment to freedom of navigation and free movement of vital commodities.

Notably absent from the Hormuz talks was the United States. President Donald Trump has made clear Washington views the situation as an alliance problem for others to solve, reportedly telling partners to “go get your own oil.” Britain and France have both pledged naval assets to a potential international shipping protection mission, with military planners from several countries scheduled to meet in London in the coming days to work through security arrangements once hostilities subside.

The fragility of the partial reopening Iran signalled during the meeting was not lost on those watching the talks. Oil markets continued to reflect uncertainty about the durability of any arrangement, and the fundamental tensions driving the crisis — the US-Israeli military campaign against Iran — remain unresolved. Analysts have pointed out that any diplomatic progress on the strait is contingent on a broader stabilisation of the conflict, something that appears far from guaranteed.

For Luxon, the meeting provided an opportunity to position New Zealand as a responsible middle power taking an active diplomatic role on a global stage at a moment when Washington has largely stepped back. With an election due later in the year, how the Government is seen to handle the fuel crisis — both in terms of international diplomacy and domestic relief — will carry real political weight. National’s polling has been difficult in recent months and the cost of living remains a central concern for voters.

New Zealand joined the Hormuz initiative alongside a wide coalition of nations that spans political traditions and geographic regions, reflecting the extent to which the disruption has become a shared concern for trading nations dependent on stable oil supplies. Whether Iran’s announcement during the meeting translates into a sustained reopening, or proves another fragile and temporary development in an ongoing crisis, will likely become clear within weeks.

The question facing the Luxon Government — and facing New Zealand families at the pump — is whether those weeks arrive quickly enough.

What do you think about New Zealand’s role in the push to reopen the Strait of Hormuz, and how has the fuel crisis been affecting you? Leave a comment below.