AA Senior Policy Analyst Mark Stockdale says "the continued reduction in pump prices reflects sustained falls in the international price of oil and refined fuel. It couldn't come at a better time for motorists, as we move into the busy summer driving season."

It's the tenth consecutive price reduction since mid-July. Petrol has dropped 46 cents per litre (21%) since reaching a record high of $2.19 on 7 July. Diesel prices have tumbled 60 cents per litre (31%), down from $1.92.

"Since July, international market prices have fallen by over 50%, but unfortunately the New Zealand exchange rate has also fallen substantially since then, offsetting some of the savings from lower international prices. In any case, the product cost makes up less than half the pump price."

In total, the New Zealand dollar has lost 17 cents against the United States dollar. According to AA PetrolWatch, petrol and diesel prices could be about 25 cents per litre cheaper if the exchange rate was still around 77 US cents.

"The international prices have been falling due to a combination of declining global demand as a result of the previous high prices, and the financial crisis. So, subject to our exchange rate, it looks like the trend for lower prices will be with us for a while yet," says Mr Stockdale.

For more information contact

Mark Stockdale

Senior Policy Analyst
New Zealand Automobile Association
T. +64 4 931 9986
F. +64 4 931 9960
M. +64 21 0220 4700
E. mstockdale@aa.co.nz

The New Zealand Automobile Association is an incorporated society with over one million members. It represents the interests of road users who collectively pay over $2 billion in taxes each year through fuels excise, road user charges and GST.