New Zealand Petrol Prices Rise Despite Falling Crude Oil

Retail petrol prices in New Zealand have risen from approximately $3.15 to over $3.50 per litre since mid-September. This increase occurs despite a decline in Dubai crude oil prices, which dropped from $210 to $192 per barrel during the same period.

Data from the Ministry of Business, Innovation and Employment shows that importer costs have increased, creating a divergence between crude oil prices and refined output prices. Economists note that Singapore Mogas, the wholesale version of petrol, serves as a more accurate indicator for retail prices than Dubai crude. Additionally, Iranian attacks on shipping and Middle East supply disruptions have forced Asian refineries to source oil from other regions, increasing transportation costs.

Westpac chief economist Kelly Eckhold explained that wholesale market changes and exchange rate shifts typically take two to three weeks to reach the pump. She suggested that a stabilization or fall in petrol prices may be coming as some refined fuel prices have recently declined. Infometrics chief forecaster Gareth Kiernan added that current Dubai oil prices may not be the best indicator for retail operations due to these regional supply disruptions.