Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Record Fuel Costs Push Petrol Prices Up

Soaring refined (ready-to-go) petrol costs and the weak NZ dollar have forced BP to lift its petrol and diesel prices by three cents a litre at its company-owned service stations with immediate effect.

BP’s Managing Director Peter Griffiths said since July 3 when BP last lifted its prices, the cost of refined petrol has risen by around NZ$7.50 a barrel - the equivalent of around 5 cents a litre - to a record high of NZ$83.19.

As BP buys its fuel in US dollars, our weak exchange rate also means BP is now paying about NZ$10 a barrel (or 7 cents a litre) more than it did in January this year.

The increase takes prices at most BP company-owned service stations in the main centres to $1.14.9 (Unleaded 91) and $1.19.9 (Premium Unleaded) and diesel to 77.5 cents.

BP buys about half its petrol as ready-made fuel from overseas refineries. Marsden Point Refinery in Whangarei does not have the capacity to manufacture all of New Zealand’s petrol needs.

Although crude oil had dropped by around NZ$5 a barrel (or 3.5 cents per litre) since early July, in the past week, crude oil prices have risen again - by around NZ$2 a barrel.


Mr Griffiths said refined costs which traditionally keep track with crude oil costs have leaped ahead in recent months.

“The refined market is driven by supply and demand. At the moment, demand is up due largely to the buoyant United States’ economy and also high demand in Asia. The end result is that fuel buyers are having to pay a lot more than they did a month ago.”

Mr Griffiths said the pressure has been on BP to lift its prices for the past three weeks, but he resisted in the hope that refined costs would start to drop to match earlier falls in crude costs.

“Unfortunately, that hasn’t happened and we can no longer afford to carry the extra costs.
We are currently making just 1 cent a litre profit for every litre we sell and in the commercial part of our business, we are losing money. No company can expect to survive under those sorts of pressures without passing on some of the extra costs.”

Mr Griffiths said he is very aware that lifting prices is unpopular and affects people’s lives. “All I can do is repeat our promise that we will swiftly pass on lower prices to motorists once we start paying less for fuel.”


ENDS

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Fuels Rushing In: Govt "Ready To Act" On Petrol Market Report

The Government will now take the Commerce Commission’s recommendations to Cabinet...
• A more transparent wholesale pricing regime • Greater contractual freedoms and fairer terms • Introducing an enforceable industry code of conduct • Improve transparency of premium grade fuel pricing... More>>

ALSO:

Reserve Bank Capital Review Decision: Increased Bank Capital Requirements

Governor Adrian Orr said the decisions to increase capital requirements are about making the banking system safer for all New Zealanders, and will ensure bank owners have a meaningful stake in their businesses. More>>

ALSO:

Aerospace: Christchurch Plan To Be NZ's Testbed

Christchurch aims to be at the centre of New Zealand’s burgeoning aerospace sector by 2025, according to the city’s aerospace strategic plan. More>>

ALSO:

EPA: Spill Sees Abatement Notice Served For Tamarind Taranaki

The notice was issued after a “sheen” on the sea surface was reported to regulators on Thursday 21 November, approximately 400 metres from the FPSO Umuroa. A survey commissioned by Tamarind has subsequently detected damage to the flowline connecting the Umuroa to the Tui 2H well. More>>

Taskforce Report: Changes Recommended For Winter Grazing

A Taskforce has made 11 recommendations to improve animal welfare in intensive winter grazing farm systems, the Minister of Agriculture Damien O’Connor confirmed today. More>>

ALSO: