Motorists rush to beat petrol price increase

Petrol stations in the South were noticeably busy yesterday as motorists topped up in an attempt to avoid the biggest one-day price rise in nine years.

However, with so many different prices across the region, it was hard to tell which service stations had upped their price.

BP Connect announced it had put up prices by 6c - the biggest one-day rise since the 7c rise in 2010, while other companies were holding off.

The highest price seen by the Otago Daily Times was $2.509 for a litre of 95 octane premium petrol at Caltex Wanaka. The price for 91 octane was $2.389.

The lowest price, $2.12 for a litre of 91 octane, was found at an NPD service station in Oamaru, which also had 95 octane at $2.21.

The increase in the global oil price was due to the drone strikes on Saudi Arabian oil production facilities at the weekend, and there was also an effect from a weaker New Zealand dollar.

New Zealand Automobile Association adviser on petrol prices Mark Stockdale said while prices at more stations could rise by the end of the week, he dismissed the suggestion they could go all the way to $3 a litre.

"This is likely to be a short-term thing because there isn't a shortage of oil globally.

"Its a reduction from one location but there are other oil producers that can turn on their taps and increase their output."

Mr Stockdale said the drone attack had caused a reduction in global supply of about 5%.

"Globally this shouldn't be a major concern."

Mr Stockdale said in 2010 the price increased by 7c, to over $1.80, "and then it continued to rise until it got to $2 by New Year".

Most price rises since then were due to increased taxes and the commodity price of oil was lower today than in 2010.

Larry Green, founder of Gaspy which keeps track of fuel prices in New Zealand, said he could understand fuel prices rising because of the attack.

However, he questioned why some companies had put up prices so quickly.

"When you have these significant international attacks, it makes it easy to crank the price up because there's a really good narrative around it."

Mr Stockdale said it was "pretty common" for fuel companies to raise their price a day or so after the commodity price has changed.

"So that's what we have seen.

"That's quite normal."

A Z Energy spokeswoman said the company used "current cost" pricing, which meant its petrol prices were based on the market value today, rather than the cost when the fuel was bought.

"This model reflects all the factors (either up or down) in the market at this moment in time, and is used by many companies who sell commodity products like us."

The company believed it was a "more transparent" way of setting prices, as there was an obvious correlation between international product prices and local price movements.

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