New Zealand's Economy Held Hostage by Global Oil Price Volatility

New Zealand's economy is being held hostage by global events, specifically the conflict between Iran and Saudi Arabia over oil prices. The price of Brent crude hit $100 a barrel last Friday, which will push petrol prices back towards $3.50/litre in New Zealand. This comes as the country lags behind others in adopting electric vehicles (EVs) and renewable energy sources.

The US and European Union are putting pressure on China to restrict its exports of panels and batteries, which has caused a backlash against China's dominance in the industry. However, this presents an opportunity for New Zealand to import these products cheaply from China before it is too late.

According to data from Our World in Data, other countries such as Australia, Uruguay, and India have implemented strategies to reduce their reliance on fossil fuels by increasing EV adoption and renewable energy production. For example, Australia has subsidized solar panels for decades and recently introduced home battery subsidies, resulting in a 19.6% increase in solar power generation last year.

New Zealand, on the other hand, is lagging behind in both EV adoption and the adoption of home solar panels and batteries, grid-scale solar and batteries. The country's cost of living, inflation rate, mortgage rates, trade deficit, emissions profile, and prospects for deindustrialization are all being affected by these global events.