Tauranga motorists are being forced to pay up to 20 cents more for a litre of petrol than their neighbours in Rotorua.



An unofficial survey conducted at lunchtime on Thursday in the two regions showed a significant difference in prices of 91 petrol.



Two service stations surveyed in Rotorua sold 91 for $1.96.9, while in Tauranga, five of seven service stations surveyed had their price set at $2.16.9. This was a difference of 20 cents per litre of petrol.



Mount Maunganui man John Graham drove to Rotorua on Thursday and was surprised to see a wide variance in petrol prices between the two centres.

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"I couldn't believe it. I was going to fill up before I left but didn't and when we got over there all down Te Ngae Rd all the service stations were at $1.96. I was absolutely amazed. I thought this isn't right, I had to double check but it was."



He said the price of fuel between the two regions should be the same as each other and it wasn't fair Tauranga motorists paid more.



When Mount Maunganui man Chris Leach travelled to Rotorua last Sunday, he was disgusted to see such a large difference in petrol prices between the two centres.



"What infuriates me is that there's no competition in the fuel market. They all follow each other and as soon as one petrol company drops the price, the others follow and as soon as one increases, others increase theirs too."



Mr Leach travelled to Rotorua every couple of months and always tried to fill his car in Rotorua.



"There's always a 5, 8 or 10 cents difference, not usually 20 cents like it was this time."



"The rates keep going up and the price of everything else is going up and I understand that but there's no accountability with these petrol companies. Someone is making a huge profit here."



AA PetrolWatch spokesperson Mark Stockdale knew the price of fuel in Rotorua was cheaper than other centres but didn't realise the difference was 20 cents.

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"That's a substantial price saving for motorists. That level of price discount is virtually unheard of in New Zealand and the AA can't recall that sort of discount," he said.



Mr Stockdale said it was difficult to explain why Rotorua service stations offered cheaper fuel than in Tauranga and other parts of the country. He said the service stations operating at 1.96.9 were making a loss on their fuel, as the current landed rate was about $2 per litre.



"Our advice for motorists living in Rotorua or travelling through Rotorua is to take advantage of the low prices because effectively they are selling the fuel at below cost and who knows how long it will last."



He said the usual profits on fuel were around three cents per litre so when discounts exceeded this, the service stations were running at a loss. Mr Stockdale said independently owned service stations could charge what they liked for petrol but he did not believe this strategy could be maintained long-term.



"Make hay while the sun shines because this is an aberration and we don't expect to see this anywhere else [in the country]."



Gull New Zealand Ltd retail manager, Graham Stirk, said there was a "discount war" going down in Rotorua at the moment.

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Jeremy Clarke, spokesperson for Chevron NZ, who markets the Caltex brand, said it was a "competitive environment" in Rotorua and the lower price did not reflect the true value of the product.



"It's an extremely competitive environment down in Rotorua at the moment."



BP communication and external affairs manager Jonty Mills said petrol prices in Rotorua had been competitive for the past couple of weeks and where it could, BP would respond and try to meet the market.



Mr Mills said he was surprised to hear the variety of fuel prices and said the $1.96.9 rate was not sustainable in the current market."



Rotorua Pak'n Save owner Neil Foster said the supermarket sold the fuel under agency on behalf of BP.



"There's been a bit of a battle in Rotorua and I'm aware fuel is significantly cheaper here than in Tauranga."

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The cost of fuel rose five cents in February.



The price of a litre of 91 octane petrol began the month on $2.12 before dropping three cents after the AA called for a price cut.



By the end of the month the price increased to $2.17 in the main centres. Diesel began the month on $1.50 a litre at most service stations and ended the month on $1.55.