New Zealand’s petrol retailers and importers must start passing on savings to Kiwis motorists following the dramatic drop in the price of crude oil, Labour’s Energy Spokesman Stuart Nash says.
“It is great news for Kiwi drivers that the price of petrol is falling. However, New Zealanders have been paying far too much at the pump and it is time retailers and importers rectified this with a permanent margin correction.
“The price both Brent Crude and West Texas Intermediate (WTI) dropped below $US50 a barrel yesterday for the first time in five-and-a-half years.
“The last time the price of crude was this low, the exchange rate was around 0.6 against the US dollar and the price at the pump was still around $1.60 per litre. Now, the exchange rate is around 0.77 and the price is $1.85 per litre.
“By my calculations, the price at the pump should be around $1.45 per litre – and falling.
“In Australia the price is equivalent to $NZ1.28 per litre. Even if we take into account the extra 15 per cent tax we pay on petrol, our price should still be around $1.47 per litre. Other Western countries, with the exception of the United Kingdom, all enjoy far lower prices.
“Importer margins have increased over the past 10 years from an average of 18.4c per litre to an average of 33.7c per litre. In December, the importer margin was nearly 40c per litre.
If these margins were bought down to their historical average, Kiwis would again be paying around $1.50 per litre.
“No matter how you do the figures, hard-working Kiwis New Zealanders are getting ripped off.
“Motorists accept that when the price of crude increases, the price at the pump goes up accordingly. However, they also expect the price to drop at a corresponding rate when the price of crude drops.
“It about time retailers and importers stopped the rort and started passing on all the savings,” Stuart Nash says.