Rising diesel price expected to put pinch on consumers

Transport operators must pass on the latest fuel increases to customers as soon as possible or face financial ruin, says a trucking industry expert.

Road Transport Forum chief executive Tony Friedlander said a hefty increase in diesel prices announced yesterday could catch out truckies who inevitably faced a delay between fuel prices rising and a time when they could renegotiate prices with customers.

"If they don't pass it on, they end up having to absorb it. I don't know any transport company that can absorb the price rises we have seen lately".

Fuel prices that have risen weekly for the past three weeks reached new highs yesterday, with the four major suppliers all raising their prices.

The price of diesel rose 5c a litre to 127.9c.

A 3c-a-litre increase for 91 and 95 octane petrol boosted prices to 170.9c and 175.9c a litre.

Only Gull managed to hold out on lifting its prices, vowing to "attempt to hold back prices as long as possible at Gull New Zealand sites".

However, the position would be revisited "on a daily basis".

Mr Friedlander said consumers across the country would soon feel the pinch, as increased transport costs flowed through to end users. The pain would be particularly acute in provincial areas, where the transport component of many goods was higher.

The transport component of a product was about 5.5 times higher in Invercargill than it was in Auckland and three times higher in Wellington.

Oil companies are blaming a number of international factors for the ongoing increases, including Iran's dogged pursuit of a nuclear capability, a weak kiwi dollar, and international supply and demand.

BP spokeswoman Diana Stretch said wholesale diesel prices had risen by over 10 per cent in NZ dollar terms in a week, while wholesale petrol costs had climbed 23 per cent in the past month.

The cost of diesel has risen 22 per cent in the past month.