The Commerce Commission has warned fuel companies as petrol prices have increased to as much as $3 a litre in some parts of New Zealand. Photo / Michael Craig
The Commerce Commission has warned fuel companies as petrol prices have increased to as much as $3 a litre in some parts of New Zealand. Photo / Michael Craig
The Commerce Commission plans to increase its scrutiny of petrol companies after ongoing increases for Kiwis at the pump.
In response to “volatile global wholesale prices”, the public watchdog will be more closely monitoring the sector as the cost of Premium 95 has already ticked past $3 a litre nationwide.
Commissioner Bryan Chapple said he has communicated with fuel companies and is prepared to publicly “call out” pricing that exacerbates ongoing global price movements.
“Nobody wants to see fuel companies using the situation in the Middle East as an excuse to unjustifiably increase prices at the pump. Any retail price increases should be aligned with actual increases in the cost of sourcing fuel.
“Public scrutiny is a powerful tool and we will use it”, he said.
Analysis of changes to fuel pricing will be provided on the commission’s website, giving a snapshot of how cost per litre variations compare with international fuel import rates.
This will include changes in regional pricing behaviours, which have already been on a steep incline in rural Australia.
While Chapple said the commission’s initial findings are yet to raise any substantial concerns, he emphasised the importance of transparency for consumers.
“We want consumers to feel confident that petrol price increases are justified and that decreases in global costs are passed through to retail prices as quickly as the increases have been,” he said.
“The gap between rising international costs and slower retail movements aligns with patterns seen during previous global shocks but it is not a licence for fuel companies to increase prices excessively.”
Commissioner Bryan Chapple says the watchdog will be keeping a close eye on the sector as fuel prices skyrocket. Photo / Commerce Commission
He encouraged Kiwis to utilise price comparison services such as Gaspy, which allows motorists to assess the cheapest deals on fuel in their area.
Chapple also warned Kiwi businesses they need to be upfront about any surcharges added to their products and services.
Chapple said while adding an uplift for the price of fuel is legal, “we expect businesses to do the right thing, and they must be honest about the reasons for any price increase”.
“We encourage anyone who believes a business has been misleading about the reason for a price increase to report it via the ‘raise a concern’ function on our website,” he said.
Ongoing conflict in the Middle East has strangled the fuel market and inflated global prices.
Earlier this week, Waitomo chief executive Simon Parham told Ryan Bridge TODAY the company’s fuel had risen by about 10-15c for petrol and 20c for diesel.
“As our Finance Minister Nicola Willis said, we haven’t got a supply problem. This is more of a pricing problem where there’s a whole lot of geopolitical risk priced into the market and so we’ve seen really short and sharp increases in prices.”
He said because New Zealand uses Singapore as the “benchmark” for petrol cost fixing, prices there “would have to come down significantly” to stop further increases.
