$3.50 a litre this year?
The AA’s principal adviser for motoring policy predicts petrol prices will climb to more than $3 for a litre of 98 octane.
Terry Collins says he wouldn’t be surprised to see service stations charging $3.50 “at some point this year”.
“The wild card is this eastern European conflict,” says Collins, pictured. Some of the world’s oil supplies come from Russia and war is causing chaos with the global supply chain.
That’s not the only issue affecting prices. Companies such as Gull or Shell buy crude oil on a fluctuating world market, then pay to get it shipped here. Local taxes and levies are added on top – GST, ACC, and emissions-trading levies.
“Almost 70 cents per litre is collected by the government in fixed excise and an additional 10 cents per litre in Auckland for the regional fuel tax,” says a spokesperson for Z. “Customers pay 15 per cent GST on top of everything.” In total, Z says it makes “about four cents per litre profit”.
For those that can afford to upgrade to electric, there are other issues. “You’ve got to wait months for an efficient vehicle thanks to supply-chain issues,” Collins told The Spinoff. He doesn’t believe the battery range or infrastructure is quite there to support a large electric-driven fleet of cars in the country, but it will soon. “They’ll be a lot better car in three years than what they are today.”
Meanwhile, the UK is joining the US in announcing a ban on imports of Russian oil and oil products by the end of the year. The British government says the transition period will give the market, businesses and supply chains more than enough time to replace Russian imports, which account for eight per cent of UK demand.
The UK is working with its other oil suppliers, including the US, Netherlands and Gulf states, to secure extra supplies.