New Zealand petrol prices are currently at an all-time high, with fears that the price of 91-octane fuel will surpass $3.00 per litre nationwide well before the end of the year.
Now the Commerce Commission is seeking to stop the unending rising prices through a series of regulations that are set to come into effect next month — namely targeting petrol companies.
The Ministry of Business, Innovation and Employment (MBIE) reports that the rise in prices stems from increased importer margins.
This corresponds somewhat with recent claims from the Automobile Association (AA) that rising prices are a result of the world coming out of Covid-19 lockdown and demand for fuel exceeding supply, although the firm stopped short of saying that petrol companies were ramping up costs in pursuit of added profits.
Some of the new regulations coming into force in February are years in the waiting. The government’s Fuel Industry Bill was announced last August, aiming to increase competition between companies by giving independent firms more flexibility with switching suppliers and by making advertising of ‘spot prices’ mandatory among other changes, but is only now coming into effect.
The biggest tweak, though, is that from February onwards petrol companies will have to report their costs and sales volumes to the Commerce Commission, giving the commission a greater understanding of the fuel market and whether companies are complying with regulations.
“This information will help the Commission monitor and report on the competitive performance of the fuel market, including whether fuel companies are making excessive margins at the expense of consumers,” said Anna Rawlings, Commerce Commission chair.
Speaking to Newsroom, general manager of retail at petrol firm Z, Andy Baird, rejects the MBIE’s claims that importer margins have been increased.
“The lag in this data has been a source of frustration for ourselves and our stakeholders for some time as it does not accurately reflect the trading conditions that Z is currently experiencing in the market,” he said
“We can categorically state that Z is not achieving the margins indicated by MBIE’s data and we continue to raise our concerns in regards to this data with MBIE.
“Z as a business is largely made up of fixed costs but did not apply for Government support during the quarter, despite meeting the criteria for the wage subsidy.”
The news comes following numerous sightings this week of premium fuel prices exceeding $3.00 per litre, with diesel also often spotted over $2.00 per litre. Monitoring Gaspy, a live update petrol price app, the lowest prices for 91 in Auckland were $2.42 at the time of writing, rising to $2.77 at the top end. Auckland diesel prices at the time of writing ranged between $1.62 and $2.04 per litre, while premium 98-octane fuel prices sat between $2.66 and $3.00.