A quiet month for motorists

Media Release: 7 June 2006

PetrolWatch – May 2006

A quiet month for motorists

After record price rises during April, motorists will be feeling a little less nervous after petrol and diesel prices remained the same throughout May, retailing at $1.71 per litre for 91 octane petrol and $1.28 per litre for diesel in the main centres.

During May there were minor movements in the price of crude oil, the New Zealand dollar exchange rate, and the cost of refined product and shipping. All of these, at times, put pressure on fuel prices.

“The AA appreciates the oil companies holding prices throughout May, despite some international price pressure. At one point in the month at least one oil company briefly raised its petrol prices but quickly reduced them again when the other oil companies did not follow suit. It was good to see the market operating competitively and for motorists not to experience any further increases,” says Mike Noon, AA General Manager of Motoring Affairs.

The AA also commends the Ministry of Economic Development for improving the modelling it provides on oil company importer margins. The Ministry’s recalculations show importer margins to be lower during the past nine months than previously reported, particularly for diesel. This is a result of oil companies having to pay a premium for the new low-sulphur diesel due to high Asia-Pacific demand and constrained refining capacity for the new blend.

LPG may be a good option for some motorists

With LPG retailing for as little as 72 cents per litre, the new generation of factory-built LPG vehicles can offer fuel savings of up to 40%* compared to 91 octane petrol.

For some motorists, purchasing a new LPG vehicle may be a good option. However the AA advises motorists to do their sums carefully before considering conversions from petrol to LPG and to get specialist advice as to the suitability of their vehicle for conversion.

For helpful tips on keeping your fuel costs down visit the AA website: www.aa.co.nz

ENDS

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