Motorists will be bracing themselves for another round of petrol price increases—not only because the government is increasing petrol tax by 3.5c a litre on October 1, but also because international crude prices are rising and the NZ dollar has depreciated around 13% since March.
Prices for West Texas and Brent crude have risen between 35% and 40% since this time last year. At the pump the national fuel price last month for 91 octane was $2.32 a litre, with prices of up to $2.50 in some regions.
Stations in Wellington and many parts of the South Island, and other areas which use the so-called “national price”, are now charging $2.409 a litre for regular petrol, the latest in a series of record highs seen in recent weeks.
Diesel prices, at $1.809, are at the highest level in just over a decade.
Brent crude, the international benchmark for crude oil, climbed above US$81 a barrel. Some traders are speculating oil could return to $US100 a barrel in the coming months.
Auckland commuters will be doing it particularly hard as they refuel because of the impact of the 11.5c a litre regional fuel tax.
But are they worse off than motorists elsewhere?
Surely the rest of the country is not subsidising them?
Road Transport Forum CEO Ken Shirley this week told TVNZ1’s Breakfast programme the falling NZ dollar and global geopolitical issues have led to fluctuations in oil prices but New Zealanders in many parts of the country pay more than Aucklanders at the pump despite the 11.5c/litre tax in the country’s biggest city.
“The whole Auckland regional fuel tax is a political sham, it’s done for political reasons to make it appear that the revenue is coming out of Auckland but in fact we all know it’s being spread across the whole country. Many parts of the country are paying 20 cents more than the market up there (in Auckland) so we do get fuel tax spreading, regional variations, that’s not surprising.”
Is it time for the government to call for another inquiry into the pricing regimes of petrol resellers by the Commerce Commission?
Perhaps ministers worry the government will suffer a backlash from the impact of rising petrol taxes.
According to Shirley:
“We’re now going to see road user and motorist taxes which previously had been going into improving the highways being diverted into other uses. Now that’s a first and it is a concern, there’s actually been an 11% cut in the highway budget in the government policy statement for NZTA.
“This is why I object to money being spent on stealing the roads I pay for to give to cyclists who don’t pay any road user charges, or ACC levies or any other costs for the roads they are using. People are getting angry.”
They are especially angry – he notes – when they must navigate their way around while avoiding trespassing on to “stupid cycleways” when there isn’t a cyclist in evidence.