Airline fuel allocation lifted from 30 pct to 50 pct Navy to...

• Airline fuel allocation lifted from 30 pct to 50 pct
• Navy to transport up to 4.8 mln litres of fuel around NZ
• "Fuel mule" flights bring in jet fuel from Australia

(Re-casts, adds detail from Air New Zealand in 3rd paragraph, oil industry spokesman in 1st, 4th paragrapsh.)

New Zealand will partially ease fuel rationing on Thursday night, a spokesman for the country's oil industry said, a sign that the five-day long fuel shortage that has caused air travel disruptions is subsiding.

More than 120 flights have been cancelled this week in New Zealand's largest city, Auckland, disrupting thousands of travellers each day, after the single privately owned pipeline that carries jet fuel from a refinery to the city's airport was damaged.

National carrier Air New Zealand (AIR) said it expected flights to run as usual on Friday, with no cancellations for the first time since Sunday.

Airline fuel allocations will rise to 50 percent, from 30 percent, at midnight on Thursday, said Andrew McNaught, manager for Mobil New Zealand Ltd and a spokesman for the customers of the country's only oil refinery operator Refining NZ.

Travel restrictions for government officials have been lifted, said Ministry of Business, Innovation and Employment Spokeswoman Carolyn Tremain in a statement.

New Zealand's government and oil industry have taken a series of measures to try to contain the crisis, from fuel rationing to calling on the military to help truck in supplies of fuel, and have set up an industry-government group to handle the fallout.

A New Zealand navy vessel will ferry diesel fuel around the country as the government rushes to alleviate the shortage in the run-up to Saturday's national election.

The ship will transport up to 4.8 million litres of diesel - equivalent to 150 tankers - to enable the oil industry to focus on providing jet fuel to Auckland airport, Energy and Resources Minister Judith Collins said on Thursday.

"The government will continue to do everything it can to support industry efforts to address the disruption," Collins said in statement.

The measures are simply a stopgap until the pipe is repaired, which will take place by Sept. 26, McNaught said.

The ordeal has become a headache for the ruling National Party which is battling it out with the newly invigorated Labour Party to form the next government.

The latest poll showed the National Party held a near nine-point lead over Labour, but polls have been volatile and at times have shown Labour with a comfortable winning margin.

Labour Party leader Jacinda Ardern has criticized the government of Prime Minister Bill English for not having taken measures to avoid the kind of infrastructure failure that led to the disruptive fuel shortage.

Overnight, Australia's Qantas Airways (QAN) operated two flights from Australia, nicknamed "fuel mules", carrying fuel to top up Jetstar and Qantas aircraft in Auckland, the airline said.

One was a scheduled A330 passenger service that carried an extra 10,000 kilograms of fuel, while the other was a special 747 flight with 65,000 kilograms of fuel aboard, it said.