Fuel prices: Cost of importing petrol hits record high

Petrol prices are still soaring, despite the temporary fuel tax cut. Photo / NZ Herald

The cost of importing petrol to New Zealand hit a record high last week, according to the latest data collected by the Ministry of Business Innovation and Employment (MBIE).

Petrol importers paid $1.59 per litre for 91, and $1.62 for 95, in the week to May 20.

These prices were 10 cents higher than the prior week (in which the previous record high was recorded), and 90 cents higher than the same week in 2021.

Accordingly, the average price motorists across the country paid at the pump last week was $3.15 per litre for 91, and $3.32 for 95.

These were the highest prices paid since March when the Government temporarily cut the fuel excise duty by 25 cents per litre. The importer price at the time was deemed to be very high at $1.38 per litre for 91.

The Government, in last week's Budget, announced the duration of the three-month tax cut would be extended by two months. Finance Minister Grant Robertson didn't rule out making further extensions.

AA motoring affairs principal policy adviser Terry Collins couldn't see prices easing anytime soon.

He noted Europeans travelling for summer holidays, and people getting back in to air travel, were putting further pressure on a limited fuel supply caused by Russia's invasion of Ukraine.

The Reserve Bank, when it hiked the official cash rate by a whopper 50 points on Wednesday in a bid to curb inflation, said: "Oil prices and their pass-through to domestic petrol prices have played a particularly large role in the recent increase in tradables inflation."

Transport made the second most significant contribution to annual consumer inflation in the March quarter, according to Statistics New Zealand. This was driven by petrol prices increasing by 32 per cent over the year.

The Reserve Bank said: "Margins for refined oil products have risen significantly and are expected to contribute to high fuel price inflation in the near term."