The imminent arrival of low-cost operator NPD in Green Island has been greeted with enthusiasm on social media, and industry observers say the increased competition, in conjunction with a turnaround in commodity prices, should result in prices falling from their recent historic highs.
Nelson company NPD's new unmanned, 24/7 Green Island station is expected to open tomorrow.
The opening is part of the company's plan to build 20 retail sites throughout the South Island.
Elsewhere, similar arrivals of low-cost operators such as Gull, Allied Petroleum and NPD had typically led to nearby competitors dropping their prices, NZ Automobile Association Petrolwatch spokesman Mark Stockdale said.
Prices had also begun to fall following a drop in global prices for crude oil, he said.
''As Gull has led this charge in New Zealand, it's known as the 'Gull Effect'.
''Usually, the effects are quite localised - per suburb where a new, low-cost and unmanned operator has shown up - but discounts of 10c per litre are not uncommon.''
The savings arose due to reductions in overheads from the low-cost, ''no frills'' business model, he said.
He was uncertain the effects of increased competition in Green Island would spread elsewhere in Dunedin, however.
''Consumers have to balance driving extra kilometres to collect the fuel, and whatever discount they can expect to receive.
''It might not necessarily make sense to travel from Mosgiel to Green Island for those 10c, for example.''
An average drop of 10c per litre had been seen in Dunedin petrol stations this week, caused by a matching drop in commodity prices, Mr Stockdale said.
The Automobile Association-monitored average Dunedin petrol price for 91-octane is $2.26 a litre, $2.35 for 95 and $1.60 for diesel.
Those figures parallel current national averages.
Commodity prices were predicted to fall further during coming weeks, which should further reduce prices at the pump, he said.
The news of possible savings and increased competition in Green Island was met with delight on social media.
Facebook group Talk on the Taieri members praised the efforts of NPD to reduce consumer costs.
An NPD spokesman said discounts would be made available to all customers at its Green Island outlet.
''All motorists can access and enjoy discount fuel at our self serve sites, as a result of their significantly lower capital and operational costs.''
