6 May 2011

No promises to cut petrol prices at pump

7:50 pm on 6 May 2011

Despite international crude oil prices dropping dramatically, petrol companies in New Zealand are making no promises about cutting prices at the pump.

On Thursday US crude closed below $US100 per barrel for the first time since March, the second-biggest one-day loss in dollar terms on record.

A spokesperson for BP says it has not seen a drop in the refined product price and will not be cutting prices just yet.

Caltex New Zealand say it is currently looking at prices in Singapore, where it buys refined oil.

Shell and Mobil could not be contacted for comment on Friday afternoon.

The Automobile Association's petrol watch spokesperson says the price drop does not necessarily indicate a long-term downward trend.

Mark Stockdale believes the reduction is just temporary and expects the price of oil to continue to rise.

Sharp sell-off in commodities

The price of crude oil dropped by 10%, prompting the sharpest sell-off of commodities in two years. The prices of cocoa and metals, including copper and silver, also fell.

Oil prices have been high in response to social tensions in the Middle East and rising consumption in economies out of recession, the BBC reports.

But Thursday saw the trend go dramatically into reverse. The slump was triggered by figures from the United States showing a surge in claims for unemployment benefits.

The BBC reports weakness in the biggest oil-consuming economy suggests demand for crude will not be as robust as forecast.

The price of silver has fallen by more than 20% from a record high of almost $US50 an ounce last Thursday.

Gold was trading at $US1477.20 an ounce.