Rise in fuel prices forecast to continue

Fuel prices at BP 2go Everedi in Princes St, Dunedin, yesterday. PHOTO: PETER MCINTOSH
Fuel prices at BP 2go Everedi in Princes St, Dunedin, yesterday. PHOTO: PETER MCINTOSH
Otago and Southland motorists are feeling the pinch of a painful price increase at the pump, figures reveal.

According to fuel tracking website Gaspy, the average price for 91 petrol throughout the two regions has increased by 10c in the past three

On January 20, the average price for the fuel in Otago and Southland was $2.51 a litre.

Gaspy listed, at the time, the cheapest place was NPD Self Service Gore at $2.40 a litre and the most expensive was in Queenstown at the BP Connect with $2.71.

However, yesterday, the average price for 91 in the two regions was $2.61 a litre.

The cheapest place was Gull Maheno in Oamaru at $2.44 a litre and the most expensive was Z Queenstown at $2.85 a litre, according to Gaspy.

Nationally, filling up at the petrol pump is costing up to $9 more than a month ago, and it is expected to continue rising.

A range of factors, including import costs, supply problems, Omicron and international unrest is leading to the skyrocketing prices.

A 30% increase in the cost of petrol in the 12 months to December last year was one of the largest contributors to the recent 5.9% inflation rate released by Stats NZ last month.

Also, the price of oil had risen to about $92 a barrel, the highest since 2014.

Automobile Association principal adviser Terry Collins expected that to hit $100 a barrel.

Domestic costs were also a factor. The emissions trading scheme levy had doubled from 8c to 16c in the last year, and was also likely to increase further this year.

Reopening New Zealand’s borders could also increase fuel demand because of an increase in flights, the gradual return of tourism, and a rise in commuting, Mr Collins said.

Petrol was not an elastic commodity — when prices rose people, did not reduce their fuel use at a similar rate.

"When fuel goes up about 10%, it only has about a 1.5% impact on demand. People just have to travel, and there are many people that just don’t have access to good public transport or alternatives.

"If they’re on a budget and they’re paying for fuel, something else has got to give to make them pay for it," Mr Collins said.

The Motor Trade Association (MTA) told drivers yesterday that petrol companies and their staff were not to blame for the high prices. — Additional reporting The New Zealand Herald


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