Motorists are rushing to fill their tanks as petrol prices soar with the conflict in the Middle East pushing up the price of oil.
And Rotorua businesses have been warned they could be heavily impacted by high prices.
Oil prices surged over 25% on Monday because of the effective closure of the Strait of Hormuz impacting global markets.
It was the biggest one-day rise in history, with a barrel of Brent crude briefly hitting US$119 ($200).
In New Zealand, Premium 95 petrol surpassed $3 a litre at dozens of locations in Auckland and other major centres.
Speaking on Ryan Bridge TODAY on Tuesday, Waitomo chief executive Simon Parham said it was too soon to speculate how high prices at the pump could go.
“There’s a lot to play out within the market and over the coming weeks,” he said.
The Rotorua Daily Post visited 11 service stations on Tuesday for a snapshot of the city’s petrol prices.
Locals Jocelyn Howard and her mum Annie Crighton pulled into the Z station on Fenton St to fill up with 95 petrol.
It was the priciest of the service stations surveyed that morning, costing the pair $2.97 a litre. Motorists with a rewards card paid $2.72 for 91 at the same pump.
To Crighton, it was clear the longer the Iran war went on, the more it would impact prices at the pump.
Howard thought local petrol prices were already “out the gate – ridiculous”.
Howard said her usual spot across the road at the Rotorua Pak’nSave fuel station was closed for renovations.
Pak’nSave or New World Westend were Howard’s go-to spots, as shoppers could get a fuel discount after doing their groceries.
At New World Westend on Old Taupō Rd, 91 petrol was priced at $2.52 a litre, or $2.44 with a voucher. Premium 95 sat at $2.67, while diesel was $1.95 a litre.
The outlet had the lowest prices recorded for all three fuel types – 26 cents cheaper for 91, 30c cheaper for 95, and 39c cheaper for diesel than the most expensive outlet surveyed.
Howard said she usually paid about $2.42 a litre on average for 91 when filling up her car.
Mike Newton, director of petrol price-tracking app Gaspy which was developed in the Bay of Plenty, said since February 24 the region had recorded a 10.62% rise in the price of 91 petrol.
He also noted that the past week had brought a surge in use of the app.
“New user registrations for the past six days have been more than triple our usual baseline daily rate with the past two days in particular rising to six times the baseline.”
Rotorua Business Chamber chief executive Melanie Short said higher fuel prices felt like another “disruption” just as confidence had begun returning to the business community.
She said high prices would be “quite impactful”, especially for businesses already operating on “tight margins”.
Industries most affected would include those heavily reliant on fuel, such as transport, delivery services, tourism operators, forestry and manufacturing.
Short said increases in fuel costs often had a “flow-on effect”, with businesses facing higher operating costs that could ultimately be passed on to customers.
That could affect the wider community as households are left with less “disposable income” and reduced spending power.
“Nobody knew this was going to happen,” Short said, describing the situation as a “geopolitical” issue outside the control of local businesses.
She said companies would now be closely watching whether the increases were a short-term spike or something that could last longer.
Short said businesses needed to focus on ways to “mitigate” the impact of fuel volatility, including reducing reliance on petrol over time through measures such as electric or hybrid vehicles and more efficient transport routes.
She said these were strategies businesses needed to consider long-term.
Short said she expected to gain a clearer picture of the local impact at a Rotorua Business Chamber board meeting tomorrow, where representatives from a wide range of sectors would discuss how rising fuel costs were affecting them.
Transporting New Zealand policy and advocacy adviser Mark Stockdale said the national industry association for road freight remained in “daily contact” with major fuel importers as it monitored developments in global fuel markets.
Stockdale said the association had been speaking regularly with companies including Z, BP and Mobil, which had advised there were “no supply issues” sourcing refined fuel for New Zealand.
He said the brief price surge in global oil appeared to have been driven largely by “panic in the market” over potential supply disruptions, particularly concerns about oil shipments through the Strait of Hormuz.
Stockdale said as a rough rule, a US$1 increase in the oil price per barrel equated to about a 1c increase at the pump, meaning sustained increases would quickly flow through freight costs and eventually the price of goods.
New Zealand sourced most of its refined fuel from refineries in Asia, which were not reporting supply problems, he said.
Instead, refineries were reporting an increase in demand for fuel internationally.
Stockdale said New Zealand had about 24 days of diesel supply in the country, with a further 29 days on the water heading to New Zealand.
While supply remained stable, he said higher oil prices still affected freight companies because fuel was a significant component of freight costs, meaning increases were likely to flow through the supply chain and eventually be reflected in the price of goods consumers pay.
Annabel Reid is a multimedia journalist for the Bay of Plenty Times and Rotorua Daily Post, based in Rotorua. Originally from Hawke’s Bay, she has a Bachelor of Communications from the University of Canterbury.