INDEPENDENT NEWS

Time For Fuel Prices To Come Down

Published: Fri 31 Aug 2001 11:10 AM
Federated Farmers Grains Council Chairman Neil Barton thinks it is about time New Zealanders saw a decrease in fuel prices.
"The exchange rate has been increasing for over month now, and we have seen absolutely no adjustment in fuel prices," said Mr Barton.
The exchange rate is only one of a number of factors that drives fuel prices in New Zealand, but Mr Barton feels that it is a major factor that should bring about a reasonably rapid price response.
"At the beginning of August, the Kiwi dollar was worth just over 41 cents, and as of 29 August it was just over 44 cents. A difference of three cents in the exchange rate should have a significant impact on prices."
Mr Barton has been following the Singapore petrol and diesel prices, which are a good benchmark for pricing in New Zealand and the rest of the South Pacific.
"The Singapore price for petrol has been increasing slightly throughout the month of August, which has offset some of the benefit of the higher kiwi dollar. However, the Singapore price for diesel has been decreasing recently and yet we see no indication of this at the pumps. The retail price has remained virtually constant."
"The price lag we are seeing is likely to be caused by fuel companies attempting to improve their bottom line by keeping prices at their current level for as long as possible"
"Many farmers believe that the loss of Challenge as an independent fuel retailer has removed any significant competition from the market, and that the price lag we are seeing is caused by fuel companies attempting to improve their bottom line."
"Agriculture and much of New Zealand industry relies heavily on diesel. High diesel prices carry downstream effects that impact on all New Zealanders," concluded Mr Barton.
ENDS

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