How Auckland's fuel prices have fared one month since the fuel tax cuts

Wednesday, 31 July 2024

It’s been one month since the Auckland Regional Fuel Tax was removed.

On July 1, the 11.5c per litre regional fuel tax no longer applied, which saw prices drop immediately for Aucklanders.

Data from fuel comparison app Gaspy showed at the beginning of July, prices sat at their lowest, an average of $2.66 a litre.

“Since then prices have gone back up about 5c to hover around $2.71, if you exclude the impact of discount days,” Gaspy director Mike Newton said.

Nationally, prices had followed a very similar pattern, but with a slightly smaller 4c increase across the country.

“The subsequent price rises since then are in line with a weakening of the New Zealand Dollar, having dropped 4.4% since peaking in early July,” Newton said.

“In fact, if it weren't for crude oil prices falling at the same time, prices at the pump would likely be even higher.”

The regional fuel tax was used to help fund Auckland infrastructure and was meant to be in place for 10 years.

AA principal advisor Terry Collins said data showed Auckland had deals as good as other major cities, and had prices that were high like other cities.

“When the tax came off we were at a fairly low rate and then international prices crept up at bit and eroded into those savings. And now the prices have dropped back down a bit so there’s only about a 4c difference.”

Fuel companies weren’t banking extra profit, he said, as their margins were no different between the beginning of the month and the end of the month.

“I have no concerns.”

The Commerce Commission, which has been monitoring the state of the fuel market, had put a report out in the weeks leading up to the fuel tax cut, which stated it would be keeping a close eye on the prices.

Commerce Commisoner Bryan Chapple said in June that if fuel companies did not reflect the 11.5c per litre drop promptly in retail prices, Aucklanders could be over-paying by nearly $1 million in the first week alone.

“They made it very clear, that ourselves [AA], them and the public would be watching to see these prices handed on, and they were,” Collins said.

Collins said the price of oil had softened and he expected a couple of cents savings in the next month or so - but he encouraged drivers to continue to shop around for the best price.