KEY POINTS:
The Automobile Association is praising oil companies for dropping fuel prices this afternoon.
Shell, Gull, BP and Caltex have dropped the price of diesel and petrol as the price of crude oil continues to fall.
AA spokesman Mike Noon said "good on them". He said the fall in the New Zealand dollar was off-setting the fall in the price of crude but over the last two days the climate had shifted in favour of a fuel price drop.
"The AA is very pleased to see the oil companies responding so quickly and they are to be congratulated," Mr Noon said.
He said the AA thought conditions were right for a drop in diesel later this week so the drop today was welcome.
Shell's unleaded 91 has dropped by 4 cents to 195.9 cents while diesel is down six cents to 153.9.
Shell spokeswoman Jackie Maitland said the fall came at mid-day today after the drops in international crude oil were translated to the price of refined fuel.
"The fluctuating New Zealand dollar has not been helpful and it has prevented Shell being able to pass on any savings to Kiwi motorists sooner as we purchase both crude and refined product in US dollars," Ms Maitland said.
Gull's retail business manager Graham Stirk said the company would drop its prices by 1pm today.
He said 91 would fall to 194.9 and diesel to 152.9.
Mr Stirk said the fall in price was due to the drop in the international price of crude and the relative stability of the Kiwi dollar over the last two days.
BP spokeswoman Diana Stretch said BP was selling 91 for 195.9 cents and diesel for 153.9.
"We've seen significant volatility in refined petrol and diesel, for example it shot up 6 cents on Monday," Ms Stretch said.
She said Hurricane Ike caused the crude price to drop after refineries were hit by the weather and the "crude had nowhere to go".
Caltex spokeswoman Sharon Buckland said Caltex had also dropped by four and six cents for petrol and diesel respectively.
Unleaded 91 is now selling for 195.9 cents while diesel is selling for 153.9 cents.
Meanwhile the price of crude continues to fall with Reuters reporting a 10 per cent drop in two days, the largest fall since December 2004.
Brent crude fell $3.60 overnight to 90.64 a barrel.
Mobil has so far not returned phone calls.
- NZHERALD STAFF
