29 Aug 2015

Action call over petrol profit margins

1:50 pm on 29 August 2015

The Labour Party is calling for an inquiry into the growing margin petrol companies are earning on fuel.

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Photo: RNZ

The latest Ministry of Business, Innovation and Employment figures show the margin has risen to 38.5 cents a litre - a year ago it was 31.4.

Minister of Energy and Resources Simon Bridges said it was disappointing to see the margin rise, but he would not take further action before the Commerce Commission ruled on whether Z Energy can buy Chevron New Zealand.

"The proposed acquisition is significant for the market and information made public after the Commission's clearance assessment will likely provide useful insights into the nature of competition in the market," he said.

The data was deceiving, he said.

"MBIE has worked with the industry to address concerns that its margin reports don't adequately reflect regional pricing and discounting practices," he said.

Labour's energy spokesperson Stuart Nash said the Finance and Expenditure Select Committee must intervene to ensure petrol companies are held to account.

"Over Christmas, when I talked to Mr Bridges about this, he said he had written them a letter and they would respond to that, now he's saying let's wait for the Z Energy ruling," he said.

"There will always be a reason not to take any action but my view is let's get on with this and take action and make sure these big petrol companies are held to account."

Z Energy spokesperson Jonathan Hill said the margin was not reflective of the market.

"What the MBIE graphs show has very little to do with the reality in the market," he said.

"There's five cents missing in terms of two price changes that have not been captured there, the Kiwi dollar has softened against the US dollar by about 1.5 cents since that data was published, and the price of oil has bounced back by about 10 cents.

"I imagine next week's data will look very different."

Z Energy's current petrol price is $1.979 per litre for 91 Octane.

A Ministry spokesperson agreed the margin was likely to decrease next week following the price reductions.

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