KEY POINTS:
Oil prices might be falling and the New Zealand dollar rallying, but motorists should not expect any pre-Christmas petrol present.
Pump prices held firm yesterday, despite oil prices falling to below US$40 a barrel for the first time since July 2004.
That fall came despite an Opec announcement
of a record production cut of 2.2 million barrels a day, and promptly sent the price of diesel falling 5c a litre. But AA spokesman Mark Stockdale yesterday told the Herald that drop would not necessarily flow over to petrol prices.
The cost of diesel was such that a price drop was "overdue", he said.
"[But] when we did the same sums for petrol ... the refined price has gone up this week and, as a result, the margin has come back to normal."
Settled margins combined with a buoyant New Zealand dollar meant the price of petrol was "about where we would expect it", Mr Stockdale said.
Oil industry insiders were unwilling to say whether holidaymakers can expect to save money when filling their tanks next week.
Shell spokeswoman Jackie Maitland said the company reacted day by day to oil price changes, and drops would be passed on to the consumer.
Pump prices in New Zealand are determined by the international price of refined petrol and diesel (purchased in US dollars), the US/NZ exchange rate, taxes and levies, shipping costs and local operational costs.
Petrol prices remained at 139.9c a litre for 91 octane and 144.9c for 95.
Gull retail manager Graham Stirk said yesterday any price fall would depend on what happened in the Singapore markets, which determine the price in New Zealand.
Although there were no indications a price drop was imminent, the cost of a litre of petrol would remain where it was so long as the dollar remained buoyant, he said.
The New Zealand dollar yesterday hit a five-week high of US58c, on the back of the Federal Reserve rate cut.
Diesel prices took a tumble with Shell dropping the price by 5c a litre late yesterday morning.
BP and Caltex followed suit with a 5c drop soon after.
The drop bought diesel to 111.9c a litre for the big players, though Gull managed to undercut them all, lowering its price to 110.9c.
Shell said the diesel drop was due to a lowering in the cost of diesel product, but the same decrease had yet to come through in petrol prices.
Petrol has dropped a total of 79c a litre since July 17, while diesel has dropped 74c a litre since July 8.
- Additional reporting NZPA
