Oil prices lowest in five years

PetrolWatch – December 2008

Oil prices lowest in five years

Motorists are enjoying the lowest fuel prices since December 2005 according to AA Senior Policy Analyst Mark Stockdale.

Retail petrol prices continued their downward trend, falling 11 cents in December to end the month on $1.33 in the main centres. Diesel fell 17 cents to $1.04 per litre, the lowest price since May 2007. Two price drops in the space of three days in late December came after crude oil prices fell to a low of US$35 a barrel, a level not seen since July 2004.

“Not surprisingly a price drop was due, although it’s worth noting that the refined price was some 14 per cent more than crude, so the reduction was not as much as some expected,” says Mr Stockdale.

According to AA PetrolWatch, the last time crude prices were this low, motorists were paying $1.14 per litre for petrol. That was at a time when a higher exchange rate and lower taxes combined to offset the difference between today’s prices.

“The run of price reductions has begun to slow, and we have seen crude and refined prices start to rise, suggesting we are reaching the bottom of the barrel in world product prices, so to speak.”

“Compared to last summer, petrol costs 38 cents per litre less, meaning Kiwis were able to travel further these holidays or save about $23 dollars a fill. This couldn’t have come at a better time,” says Mr Stockdale.

ENDS

© Scoop Media