Another Two Cent Petrol Price Rise At Caltex
New Zealand¹s fourth biggest oil company has announced a two cent per litre increase in the retail price of petrol and diesel effective from midnight tonight (Wednesday 25 August 1999).
Caltex New Zealand Limited says the rise is due to increasing prices for crude oil world-wide. The price of crude is now the highest it has been since the Gulf War of 1990, the company says.
Mr Bruce Hollett, General Manager Sales of Caltex, said since 1 December 1998 the price of crude oil had risen from NZ$18.64 a barrel to NZ$38.26, or 12.34 cents per litre excluding GST.
New Zealand refines about 80 per cent of its fuel requirements from crude oil at the Marsden Point Refinery. Mr Hollett said the shortfall was made up by importing refined product, most of it from Australia.
"This imported petrol is bought on the spot market where the price has gone up slightly more than 16 cents a litre since late last year," he said.
In the past month, including the latest rise, petrol prices had increased by 9.77 cents per litre in the North Island and 8.89 cents per litre in the South Island, far from making up the increases of 12.34 cents or 16 cents a litre Mr Hollett said.
The deficit between the rise in international oil costs and the increases in pump price had been absorbed by Caltex through restructuring to increase efficiency and minimise the impact of rising crude prices.
Mr Hollett said common public perception of oil companies making excessive profits was not correct.
"In many industries, our margins would be considered laughable in relation to the large amounts of capital employed."
He could not rule out further price increases before the end of the year but acknowledged that recent price increases at the pump would have some impact on inflation.
"Unfortunately, the price rises are beyond our control dictated as they are by the world market for crude. We have tightened our belts considerably and there aren¹t any notches left right now," he said.