Fiji’s economy is facing a fresh challenge from rising global energy prices, with ANZ Research warning that higher petroleum import costs are likely to widen the country’s current account deficit and reduce foreign exchange reserves over the remainder of the year. While the outlook presents new pressures for businesses, the bank believes Fiji remains well placed to absorb the shock without major disruption to capital flows or exchange controls.
In a Pacific Insight report released on 31 July, ANZ estimates that Fiji’s imports of mineral fuels—including petrol, diesel and jet fuel—will reach a record FJ$2 billion in 2026, an increase of almost 26 per cent on last year. The report notes that imports totalled FJ$656.2 million during the first four months of 2026, already 36.3 per cent higher than the same period in 2025.
The increase is being driven not only by higher crude oil prices but also by sharply higher refining margins. ANZ notes that since the outbreak of conflict involving Iran earlier this year, Singapore diesel and jet fuel prices have risen by around 75 per cent above pre-conflict levels, significantly outpacing the increase in Brent crude prices. Continued security concerns affecting shipping through the Strait of Hormuz are expected to keep oil prices elevated at around US$90 a barrel for the rest of 2026.
For Fiji, which imports virtually all of its refined fuel requirements, the consequences extend well beyond the fuel sector. Higher energy costs increase transport and freight expenses, raise production costs for manufacturers and processors, and place additional pressure on sectors such as tourism, agriculture and construction. Import-dependent businesses are likely to feel the greatest impact as higher international prices work their way through supply chains.
ANZ expects the higher fuel bill to widen Fiji’s current account deficit to around FJ$1.5 billion, compared with FJ$1.039 billion last year. The report says the deficit will be financed through a combination of capital inflows and a drawdown in foreign reserves.
Importantly, the bank does not see this as a cause for alarm. Fiji’s foreign reserves currently stand at approximately FJ$3.9 billion, equivalent to 5.4 months of retained imports. ANZ forecasts reserves will decline to around FJ$3.2 billion by the end of the year, still comfortably above the international benchmark of three months’ import cover. As a result, it does not expect any significant changes to Fiji’s exchange control rules or restrictions on capital outflows.
For Australian businesses trading with or investing in Fiji, the report offers a balanced assessment. It highlights the reality that global geopolitical events continue to influence operating costs across the Pacific, while also reaffirming the underlying resilience of Fiji’s external position. The challenge for businesses will be managing higher energy-related costs while continuing to invest in productivity, efficiency and supply chain resilience.
Source: ANZ Research, Pacific Insight: Fiji – Higher petroleum product prices to impact foreign reserves, 31 July 2026.
