Yesterday’s 6c petrol price rise by Mobil, BP and Caltex seemed too much given the relative changes in crude oil prices and the exchange rate since last week’s rise. And so it seems proven. Shell, which held back on lifting prices yesterday, has today put its prices up by 4c, making 91 Octane at Shell stations 210.9c a litre, compared with the 212.9c of its rivals.
And as a point of interest. While different tax rates and many other local conditions in Australia make comparisons not quite apple with apple, Melbourne motorists are now paying up to A 166.9c a litre for 91 Octane, which is around NZ 208.6c. It proves nothing, but does suggest prices here are not wildly out of line, given the relationship between our two economies.
7 Comments
June 13, 2008 at 9:28 pm
NZ’s petrol taxes aren’t outrageous.
It seems perverse that people are seeking to have fuel taxes reduced at precisely the moment we need the money they raise to construct the public transit alternative to the private car. We need it anyway, even if oil prices do come back down for a month or a year.
If the price keeps going up, we would have sacrificed future options for a few extra months of the way things used to be.
Sort of like the “last tree” idea……Ever wonder what the went through the mind of the Easter islander who chopped down the last tree?
How could they BE so stupid?
One day at a time….just like we are.
June 13, 2008 at 10:31 pm
Am at present being lucky enough to be doing a bit of travel, the petrol prices in New Zealand don’t seem nearly so bad once you hit GB and Europe, in fact prices in general in New Zealand seem quite reasonable when looked at from a global perspective, and as for my Oyster card role on Wellington converting to this.
June 13, 2008 at 11:51 pm
Um, Jared Diamond’s hypothysis has been pretty well demolished by research that targets RATS
(kiore) for killing off vegetation on Easter Island-
June 14, 2008 at 1:18 am
Travelling to the UK and paying for petrol there with money earned in NZ and subsequently converted into British Pounds would give the allusion that petrol prices in New Zealand do not seem nearly so bad. For example paying for 1 litre of British petrol (96.5 pence/litre) you would need to take from NZ to the UK, 2.51 NZ dollars. Compare this with 1 litre of NZ petrol bought in NZ for $2.11.
However considering further that the paying for petrol, like anything else, is related to the effort of time taken to earn that money and assuming that the average wage in NZ is say $34,684/year then the time taken to pay for 1 litre of petrol (at $2.11) is 31.9 minutes.
For those residents working in the UK and assuming again that the average wage is £24,000/year then the time taken to pay for 1 litre of petrol (96.5 pence) is 21.1 minutes.
This quick analysis may not be totally accurate but it does indicate that for each of the UK and NZ populations it takes less time at work in the UK to pay for petrol.
June 14, 2008 at 1:37 pm
Poneke … overall I can accept the rationales for why the price of the oil companies inputs are rising. But there’s one thing that doesn’t seem to be picked up by the MSM.
Globally there’s a major shortage of refinery capacity, and so refining margins have climbed. This is a major factor in petrol price rises … prices are rising for the underlying crude, for transporting crude to the end market, and for refining the crude.
About 50% (from memory) of New Zealand’s crude is refined at Marsden Point. Effectively Marsden Point supplies the top half of the North Island, and imported refined products supply most of the rest of us.
But the refining margin at Marsden Point is capped at US$9 per barrel.
I understand that refining margins on the open market are way more than US$9 per barrel, so the oil majors in NZ are protected to some extent from that cost increase. Which should mean our oil products shouldn’t rise in price quite as fast as other countries.
Now I’m not sure just what the saving is, and it only applies to about 50% of New Zealand’s supply, and the current price rises are probably linked more to the price of the underlying crude. But it should be having some effect on holding our prices down a bit.
June 15, 2008 at 9:16 pm
Virtual
It’s more like 65-70% and that will increase after an expansion project is finished. It’s oversimplistic and in fact downright wrong to say it just provides the top half of the NI as cargoes from overseas are delivered to MP destined for the Auckland market.
The price cap is a quid pro quo for the refiner having a specified guaranteed income. So in years of poor margins, of which there have been many, it earns more than it might have from the market. Overall the effect of the two schemes probably is decigned to balance each other out over time.
the NZ market like the Australian works on an import parity basis. In short the price of refined product is set at the cost of importing comparable Singapore market fuel.
June 16, 2008 at 9:33 am
I was talking to a friend in the UK yesterday and she had to queue at a pump in Kent to fill up and people were panic buying. Perhaps no coincidence the press coverage in the UK Saturday papers was claiming rise after rise in the coming weeks.
I guess NZ is pretty tame by comparison but what I can’t understand is how quickly a rise in the price of a barrel affects the pumps, but any drop (isn’t Saudi increasing production immediately?) appears to take bloody weeks.
And would a petrol commissioner make any difference to this?