13 May 2015

Fuel price jump in parts of North Island

1:31 pm on 13 May 2015

Fuel companies have scrapped heavy discounts on petrol prices in some regions in the North Island, raising prices by 20 cents.

Service stations are warning customers not to take risks to stock up on cheap fuel.

Photo: AFP

Some Gull service stations in the North Island raised the price of 91 octane by 20 cents yesterday to about $2.05, with Z Energy and BP following suit.

The price for the rest of the country dropped to about $2.08.

Gull general manager Dave Bodger said the discounted prices were too low to be sustainable.

"It's not a decision that we've taken lightly but it's about having a sustainable business model," he said.

"Some people have got some excellent value on fuel for a long time, and a lot of people outside of Gull areas hadn't received that, but we'd got to a point where, hey, we couldn't continue to deliver that difference in price."

Mr Bodger said, despite the rise, Gull's fuel was still cheaper than most of its competitors.

BP spokesperson Jonty Mills agreed Gull's discounted prices were unsustainable.

He said there was a balance between fighting hard for market share and discounting to the point where BP would be selling at a loss.

"We acknowledge that the market has been uneven in terms of regional spread but, from a BP perspective, we're a national player and some of the levels of discounting is simply not sustainable across the whole country."

Get the new RNZ app

for ad-free news and current affairs