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Prices drop at the pump

 

Questions are being asked as to why fuel prices didn’t fall sooner. PHOTO/STOCK.ADOBE.COM

Fuel prices at Wairarapa stations are dropping, as the government questions why fuel retailers are taking home record-high profits.

At Waitomo on High St in Solway, prices for 91-octane dropped from just under $3 per litre on Monday night to $2.80 per litre yesterday. Other fuel retailers in Wairarapa also saw similar drops.

Part of the reason for the price drop has been put down to import prices dropping. Internationally, global crude oil prices and refinery costs have been dropping for several weeks. However, the prices paid by consumers in Wairarapa have remained at or above $3 per litre.

Instead, only when Energy Minister Megan Woods started questioning fuel retailers about the increased profit margins did prices fall.

AA Wairarapa chairman Craig Bowyer said any drop would be greatly welcomed by those struggling with high prices in the region.

“It’s good to see them dropping and hopefully they continue to – every little bit of relief is more than welcome.

Bowyer said that the AA was behind government initiatives to ease petrol costs but was concerned about the lost tax revenue.

“We are concerned that that tax that goes into road funds isn’t being topped up. Our roads are in a great state of disrepair. There’s also a drop in diesel which will hopefully relieve cartage prices – but the tax cuts are not evenly spread.”

Bowyer said it raised questions as to why the drop in prices had taken so long.

“I think it comes from a lot of places, but it makes me wonder about how it’s been going on.”

Import prices peaked for both diesel and petrol on the week ending June 17, when import costs for diesel were $1.96 per litre and regular was $1.64.

This steadily dropped over the following weeks, and by the week ending July 8, diesel and regular imports cost $1.69 and $1.51 respectively.

Yet prices at the pump were not responding to the trend, and importer margins skyrocketed, despite promises from fuel retailers they would not pocket the difference from the 25c fuel excise that was meant to be passed on to customers.

The margin recorded for the week ending July 8 of 45.2 per cent was the largest on record, soaring from 22.9 per cent just one month earlier.

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