Fuel falls on kiwi's strength

But unpredictability remains over future fuel pricing. Photo by Stephen Jaquiery.
But unpredictability remains over future fuel pricing. Photo by Stephen Jaquiery.
Diesel and petrol prices fell yesterday as the strengthening New Zealand dollar - near record highs against its US counterpart - remains as a price-rise buffer for motorists.

BP dropped its prices first yesterday, by 2c, with diesel down to $1.48.9c a litre and 91-octane fell to $2.21.9c.

The kiwi yesterday touched a new three-year high at US88.29c and is edging closer to its post-float record, of US88.40c which it last hit in August 2011.

BP communications manager Jonty Mills said volatility from recent Middle East tensions had eased, prompting a decline in international product prices, which fed through to the pump price decline.

''That's also being driven with the [New Zealand] dollar at more than US88c at present,'' he said.

Whether there were more declines in the pump price remained ''unpredictable'', given all the components which drove the price, he said.

Global oil prices have continued their slide from late-June peaks, despite a sharper-than-expected drop in US crude inventories, AFP reported.

Some analysts credited a low read on inflation in China, pointing to slow economic growth, for the fall.

US benchmark West Texas Intermediate for August lost ground for the ninth straight session on Wednesday, shedding $US1.11 ($NZ1.26) to $US102.29 a barrel compared with Tuesday's close.

Brent North Sea for delivery in August fell 66c to close at $108.28 a barrel in London trade.

The US Department of Energy said American crude inventories tumbled 2.4 million barrels in the week ending July 4.

- simon.hartley@odt.co.nz

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