Sluggish economy to keep fuel prices low

A slowdown of the international economy is expected to keep fuel prices low for Christmas in a global case of supply and demand.

That comes from AA motoring affairs principal policy adviser Terry Collins, who said he "can’t see prices going up" in the coming weeks.

Investigations by the Otago Daily Times found that on October 20 the average price for 91 around Oamaru was $2.90 per litre. 95 was $3.05 and diesel was $2.23.

Last week, on November 22, this dropped to $2.85 for 91, $3.02 for 95 and $2.20 for diesel.

Prices have continued to drop. Yesterday the average price was $2.80 for 91, $2.96 for 95 and $2.16 for diesel.

According to fuel price tracking app Gaspy prices for 91 were as low as $2.73 in Dunedin, $2.89 in Queenstown and $2.69 in Invercargill.

Mr Collins said the reason for the slow but steady decline in fuel prices was a global slowdown in purchasing.

"Nobody’s buying things."

People had less money to spend, which meant less products were sold.

Many of the world’s goods were made in China, but fewer purchases meant the country was shipping much less out.

That meant much less was being spent on fuel to power large container ships.

Opec was trying to stop the price from falling by removing millions of oil barrels from the market, but evidently it was not working work, he said.

All Oamaru gas stations dropped their prices from October 20 to November 22 aside from NPD, which increased its prices for all its fuels.