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Motorists are facing a fuel price hike of 5c a litre after crude oil prices hit the psychological US$100 a barrel this week, economists have warned.
Brendan O'Donovan, chief economist at Westpac, said that based on today's crude oil price and NZ dollar, on normal margins 91-octane fuel should rise by 5c a litre.
US crude oil surged to the nominal all-time high of US$100 on Wednesday, the first day of trading in 2008, but had settled back to US$99 by last night.
Falling production in some areas outside of Opec and growth in demand in countries such as China are blamed.
Political problems in Nigeria, Iran's dispute with the West, conflict between Turkish armed forces and Kurdish rebels in northern Iraq, and oil's growing appeal to financial investors are also cited.
Meanwhile, supply restraint by the Organisation of Petroleum Exporting Countries helped prices to rise by nearly 58 per cent last year, the biggest annual gain this decade.
Back in Wellington, oil company head offices were being circumspect.
Sharon Buckland, spokeswoman for Caltex, said the oil company was not going to move on its prices at the pump yet, because the price of crude oil was so volatile - it went up to US$100, then dropped back to US$96, before hovering at around US$99.
She said the New Zealand dollar, at just under US78c, was also providing a good buffer.
"So at this stage we're going to hang on and see how we go."
Jackie Maitland, spokeswoman for Shell, said it also had not moved, with prices remaining at around 169.9c for unleaded, 175.9c for 95, and 124.9c for diesel yesterday.
"We are closely watching the international fluctuations in price and we will take that into account when reviewing our pump prices. We will hold our price as long as we can despite the volatility."
Mobil's Australian-based spokesman Alan Bailey said the oil company "generally hesitated' to forecast what would happen with oil prices.
He said that what Wednesday's increase in the crude oil price might mean for the New Zealand motorist was "anyone's guess", as the price had been up close to that level on a number of occasions in recent months.
"It depends what's caused that increase and how long that's sustained for. It is very difficult to project what's likely to happen in the coming days and weeks."
BP spokeswoman Diana Stretch said a price rise was possible, and the company reviewed prices every day based on a combination of factors.
"At this stage it's just one day's data, we don't make decisions based on one day's data."
But ANZ chief economist Cameron Bagrie predicted "more pain at the pump". New Zealand motorists were lucky the local currency was providing insulation against the real impact. "If it wasn't for that high New Zealand dollar, we'd be getting absolutely clobbered at the moment."
Mr Bagrie said the scary scenario for motorists was if oil prices remained at US$100 but the New Zealand dollar started to come down.
While Australian motoring group NRMA was yesterday picking the latest rise would push petrol prices up to A$1.50 ($1.72) within a week, the Herald understands the Automobile Association here won't predict price levels for fear of giving the oil companies something to aim for.
AA spokesman Simon Lambourne said it was some consolation that many New Zealanders would have already made their holiday road trips.
"But look, we have to face facts, that it's an international market ... There's not much New Zealanders can do ... "
He said prices at the pump were likely to be volatile this year, and it was up to motorists to be astute.
He advised shopping around, and said supermarket fuel discount vouchers could be a good deal.
Mr Lambourne also said fuel could be saved by modifying driving habits.
