KEY POINTS:
The Automobile Association is calling on petrol companies to drop their prices by a further two to three cents a litre.
Shell, Gull, BP, Caltex and Mobil have dropped their price of petrol and diesel at the pump by three cents a litre.
Shell and BP are now selling 91 octane for 165.9 and diesel for 103.9 while Gull is a cent cheaper on both fuels.
But AA policy analyst Mark Stockdale said the petrol companies could go further.
"The price drop is welcome, it's better late than never. We believe the price reduction could have been passed on prior to the long weekend," Mr Stockdale said.
He said the strengthening of the exchange rate justified another drop.
The New Zealand dollar surged to three-week highs against major currencies overnight, climbing from US52.68c at 5pm yesterday to around US54.45c early today before easing to US54.07c by 8am.
Mr Stockdale said the AA looked at the retail margin of oil companies, analysing the cost of fuel and the exchange rate, together with freight and tax costs. He said the figures showed that the petrol company margins were above average.
Last Thursday, the AA called on petrol companies to drop their prices by six cents a litre when the NZ dollar was trading just over US51 cents.
But petrol companies rejected the call and said there was no room to move.
Caltex spokeswoman Sharon Buckland said today that the AA were entitled to their views but "while they are an observer of the market, they are not privy to the commercial decisions that we make."
She said the AA did not affect what Caltex charges.
Ms Buckland said today's price drop was due to the strengthening New Zealand dollar while the refined prices had stabilised.
Speaking about today's drop, Shell spokeswoman Kylie Reeves said the cut was due to a strengthening New Zealand dollar.
Gull's retail business manager Graham Stirk said the price cut was also due to the strengthening New Zealand dollar.
He said his company dropped petrol yesterday afternoon "under the radar" and moved on diesel this afternoon.
BP spokesman Neil Green said his company dropped prices as a direct result of "competitive pressure".
He said while the dollar has strengthened, it is still volatile and said it did not play a factor in the price drop.
"We never do pricing based on one day's activity," Mr Green said.
He said the price of refined fuels are still high.
Mobil spokesman Alan Bailey said the price fall came after a strengthening of the New Zealand dollar and a softening of the international price.
Mr Bailey said Mobil did not drop prices by a further three cents because of "competitive pressures".
"You look at what sort of returns you need and what sort of returns you are going to get and price accordingly," Mr Bailey said.
Shell
91: 165.9 cents a litre
V-Power: 170.9 cents a litre
Diesel: 103.9 cents a litre
Gull
91: 164.9 cents a litre
91 Regular Plus (biofuel blend): 163.9 cents a litre
Diesel: 102.9 cents a litre
BP
91: 165.9 cents a litre
95: 171.9 cents a litre
Diesel: 103.9 cents a litre
Caltex
91: 165.9 cents a litre
95: 170.9 cents a litre
Diesel: 103.9 cents a litre
Mobil
91: 165.9 cents a litre
95: 170.9 cents a litre
Diesel: 103.9 cents a litre
