Fuel costs relative to income higher in NZ

Discussions about the fuel price are often fixated on price per litre, but the number we should be looking at is the percentage of salary spent on fuel annually, Aimee Shaw reports.

DATA from the website Globalpetrol prices shows New Zealanders spend about $2.55 per litre on petrol, placing us around the middle of the pack, and well above the global average of $1.80 per litre.

This is, of course, well ahead of oilrich regions such as Iran, Kuwait and Nigeria, which all pay less than $1 per litre of fuel.

However, $2.55 does not seem a bad deal to motorists in Norway, who spend $3.19 a litre or Hong Kong, where they pay $3.42 for four metric cupfuls.

New Zealand is also better off than the UK, Ireland, France and Denmark.

This might seem New Zealand is getting a relatively average deal, particularly when compared with the rest of the developed world — but things start to look far worse when you factor in how much Kiwis are spending on fuel relative to income.

Research from Bloomberg, released in July when the petrol price was $2.32 a litre, shows New Zealanders spend an average of 2.56% of annual income at the pump annually.

The percentages will now be higher as the cost of fuel has risen by at least 20c since then.

New Zealanders are among the highest consumers of fuel in the world per capita, burning through about 672 litres a year.

When this is factored in alongside the fuel price, citizens of Hong Kong and Norway actually get a much better deal than New Zealand.

While we are spending over 2.5% of our income on fuel, those in Norway only spend 0.53% and in Hong Kong only 0.49%.

The only countries to get worse deals than New Zealand are Brazil (2.8%), Saudi Arabia (2.87%), Greece (2.95%), Canada (3.01%), South Africa (3.64%) and Mexico (3.94%). — NZME