Impacts of Middle East Conflict on NZ Economy: Brad Olsen
- Mar 16
- 3 min read
Listen to the full podcast episode on Spotify here.
Listen to the full episode on YouTube here.
When global conflicts make headlines, it’s natural for people to wonder what it means for their own finances.
Will petrol prices go up? Will KiwiSaver balances drop? Could the economy slow down?
To unpack what’s actually happening, I sat down with Brad Olsen, Chief Executive and Principal Economist at Infometrics, for a conversation about the real economic impacts global conflict could have on New Zealand.
Brad is one of the country’s most recognised economic commentators and regularly explains complex economic issues across national media. The goal of our conversation wasn’t to create fear. It was to help everyday New Zealanders understand what’s happening so they can make calm, informed decisions about their money.
Here are some of the key insights from our kōrero.
Why Global Conflicts Affect New Zealand’s Economy
New Zealand is a small, trade dependent country. That means global disruptions can ripple through our economy even if the conflict is happening on the other side of the world.
One of the biggest channels this happens through is energy markets.
Oil is traded globally. When conflict disrupts supply or creates uncertainty about supply, prices tend to rise. That increase flows through to countries like New Zealand that import fuel.
And because fuel is used to transport goods, power industries, and move people around, rising fuel prices can push up the cost of many other things as well.
It’s one of the fastest ways global events can affect household budgets.
Why Petrol Prices Often Rise Quickly
One of the first things people notice during global instability is the price at the pump.
Petrol prices can move quickly because they respond to expectations about global oil supply. Even the possibility that supply could be disrupted can push prices up.
For New Zealand households, higher fuel costs can have a double effect.
First, people are directly paying more for petrol.
Second, businesses facing higher transport costs may pass some of those costs on through higher prices for goods and services.
This is why fuel prices often become a major talking point during periods of global tension.
What This Means for Inflation
When costs rise across fuel, transport, and goods, it can add pressure to inflation.
Inflation simply means prices rising across the economy.
New Zealand has already been navigating higher inflation over the past few years, and global disruptions can add another layer of uncertainty.
However, it’s important to remember that these shocks are not new. Economies regularly experience disruptions from global events, and markets often adjust over time.
Why Your KiwiSaver Balance Might Drop
Another thing people often notice during periods of global uncertainty is movement in their investments.
If you open your KiwiSaver account during times like this, you might see your balance drop.
That can feel stressful, especially if you’re not used to seeing markets move.
But market volatility during global events is normal.
Investors around the world react to uncertainty by adjusting where they put their money. That can cause markets to move in the short term.
The biggest mistake many people make during these periods is reacting emotionally to those short term changes.
For long term investors, volatility is part of how markets work.
The Word You Might Hear: Stagflation
You may have also heard economists discussing the risk of Stagflation.
Stagflation happens when three things occur at the same time:
• Prices rise
• Economic growth slows
• Unemployment increases
It’s a challenging economic environment because the usual tools used to control inflation can sometimes slow growth even further.
That said, economists are still debating how likely this scenario is for New Zealand. Many factors would need to align globally for stagflation to occur here.
What Everyday New Zealanders Should Focus On
With so much noise in the news cycle, it’s easy to feel overwhelmed.
But the reality is that most global economic events play out slowly over time.
For households, the most practical focus points remain the same:
Build financial stabilityKeep contributing to long term investmentsAvoid reacting emotionally to market movementsFocus on increasing your earning power where possible
Economic headlines can feel chaotic, but strong financial habits matter far more than trying to predict global events.
Want the Full Conversation?
In this episode of the Māori Millionaire Podcast, Brad Olsen breaks down:
• The biggest economic risks global conflict could pose for New Zealand
• Why petrol prices move so quickly
• How high fuel prices could realistically go
• What stagflation actually means
• What people should understand about KiwiSaver during market volatility
• What everyday New Zealanders should focus on right now
If you want the full breakdown explained in simple, practical terms, listen to the interview here.
Listen to the full podcast episode on Spotify here.
Listen to the full episode on YouTube here.
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