4 May 2011

Price of petrol reaches new high

10:40 pm on 4 May 2011

Fuel companies have lifted retail petrol prices to another record high, but the Automobile Association believes it is unjustified.

The cost of 91 octane petrol has risen by 3 cents per litre to $2.21.9 a litre in the main centres, surpassing the previous record high set in 2008.

The price of 95 octane has risen 3c to $2.28.9 per litre, but diesel remains unchanged at $1.64 per litre after falling 6c in April.

The Automobile Association believes the latest rise is unjustified and motorists want to know why, when the US dollar is weak and the New Zealand dollar is strong.

But fuel companies say the price of refined oil has risen by 14% in the past six weeks and they can not absorb this any more.

Caltex says the price of petrol would not be a record without increases in government excises of 10c per litre last year.

Greenstone Energy, which owns the Shell brand, says it has lifted prices due to an increase in demand for refined fuel at a time of lower supply because some refineries are shut in Asia.

Price justifiable - watchdog

An independent petrol price watchdog says the latest rise is probably justifiable.

FuelTrac managing director Geoff Trotter says the increase is probably reasonable, because the New Zealand price just follows the international price plus taxes and a large margin for the oil companies.

Mr Trotter says since February, the price has been driven up by the political crisis in Libya, the earthquake and tsunami disaster in Japan and the shutdown of a major refinery.

The full cost of the latest shutdown probably has not yet been recovered and further rises are possible, he says.