Fuel prices drop after Govt nudge
Fuel prices are dropping across the country after the Government questioned fuel companies’ profit margins.
In Auckland, the price of 91 octane petrol was between $2.88 and $3.05 a litre across stations yesterday morning, while diesel was between $2.79 and $2.97, according to PriceWatch. Prices had dropped below $3 in Wellington and Christchurch.
AA principal policy adviser Terry Collins said the decline was down to two things: the drop in price of crude oil and refinery, but also the questioning of why fuel companies had high profit margins by the Government.
Last Tuesday, crude oil prices plunged more than 7% as prices fell below US$100 (NZ$162) a barrel. ‘‘It was a combination of the cheaper crude and cheaper refinery, and it’s resulted in quite a significant decrease in landed price,’’ Collins said.
But that landed price had been taken as margins by the oil companies and on Monday Energy Minister Megan Woods yet again had spoken to fuel company chief executives, asking why its margins were so high. ‘‘And they’ve responded by dropping prices,’’ Collins said.
The Ministry of Business, Innovation and Employment monitors weekly fuel prices and margins, and in the week ending July 8 it
‘‘A combination of the cheaper crude and cheaper refinery . . . resulted in quite a significant decrease in landed price.’’ Terry Collins
AA principal policy adviser
showed petrol margins were up from 22c to 45c a litre. Diesel margins were up from 30c to 64c a litre.
The drops came after the June quarter Consumers Price Index was released by Stats NZ, which found petrol prices had risen 32% over the previous 12 months. It was the biggest annual increase since 1985 but was dwarfed by the 74% rise in diesel prices over the year.
Over a period of just three months the average price of 91 octane petrol rose from $2.67 to $2.84 a litre, while the average price of diesel jumped from $1.98 a litre to $2.57, Stats NZ said.
A year earlier, the average price of 91 octane petrol was $2.13 a litre, and diesel was $1.40 a litre.
On Sunday, Finance Minister Grant Robertson announced the 25 cent fuel excise cut, half-price public transport fares and the Road User Charges cut would continue until January 31, 2023, having started in March..