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It is a myth that petrol prices are fast to rise and slow to fall, according to a study released by the Government today.
Commerce Minister Lianne Dalziel said the report by independent consultants confirmed that petrol prices in New Zealand were set according to international prices.
The key findings of the review were:
* The New Zealand petrol market is fundamentally competitive;
* Price rises are mainly due to increases in crude oil price overseas;
* Retail petrol prices are not fast to rise and slow to fall;
* A Fuelwatch scheme like that in Australia (where petrol prices are published and fixed for a certain time) would not work in New Zealand as the market is different; and
* There was a need for more transparency on importer margins and reporting them would be useful for consumers.
"New Zealand is not alone in its experience of rapidly increasing petrol prices, but it was right to check the market in New Zealand has been operating effectively," Ms Dalziel said.
"In New Zealand there has been confusing volatility in the price of petrol, so the Government is going to increase monitoring in order to further improve the transparency of pricing."
Ms Dalziel said the report showed there was a need for better information for consumers about the make-up of importer margins - the difference between the retail price (less tax and duties) and the landed cost of the refined product.
The report said New Zealand had the fifth lowest petrol prices including taxes in the OECD.
It was commissioned by the Economic Development Ministry and written by consultants Hale and Twomey.