Mike Bennetts says people are Skyping relatives instead of
Z Energy says petrol consumption is falling in relation
to increasing availability of broadband.
While more fuel-efficient vehicles and rising petrol prices
have also contributed to consumption falling from its 2007
peak, Z's chief executive, Mike Bennetts, said demand was
more sensitive to broadband connectivity than these
"People are doing less discretionary motoring and that may be
about the price but what we have found is quite a strong link
between broadband connections and fuel consumption," he said.
"People are doing online shopping and Skyping granny rather
than making the fortnightly visit."
A 1 per cent improvement in broadband connectivity is
estimated to cause a drop of 200 million litres a year in
national fuel demand, more than the impact of GDP growth,
population, fleet turnover, vehicle efficiency and the petrol
Fuel consumption peaked at 4.2 billion barrels a year in 2007
but is estimated by Z and the Ministry of Business,
Innovation and Employment to fall to 3.6 billion barrels
within the next 10 years.
Z has between 25 per cent and 30 per cent of fuel sales, and
data compiled for an investor day shows light vehicle travel
per person has fallen 6 per cent since 2005.
However, diesel use is increasing and while historically
pegged to GDP growth is now surpassing that.
Bennetts said jet fuel sales were influenced by the strength
of tourism, although an increased number of aircraft was
balanced by more efficient engines.
Refinery margins were highest with jet fuel and diesel,
followed by petrol, and the lowest were fuel oil and bitumen.
Declining petrol sales made margins more important, he said.
"We've been beating the drum for a few years. In a flat
market, albeit declining in some products, it's all about
margin management as the way to be successful."
After-tax profit was about 3c to 4c a litre and if the
company was able to add a cent of margin that would make up
for 8 per cent to 9 per cent less volume.
BP said its figures also showed a fall in overall petrol
consumption and its own sales were outstripping industry-wide
diesel demand, growing by about 3 per cent. It said demand
for premium petrol was increasing.
4.2 billion barrels a year - fuel consumption peaked at in
3.6 billion barrels a year - expected total within next 10
- Grant Bradley of the New Zealand Herald