New Zealand to investigate oil companiesJune 16th, 2008 - 11:45 am ICT by IANS
Wellington, June 16 (DPA) The New Zealand government has launched an investigation into petrol pump prices to see whether oil companies are operating an illegal anti-competitive cartel, Commerce Minister Lianne Dalziel said Monday. But Dalziel warned drivers, angry at two big increases last week, that the country had the fifth lowest pump prices in the 30-member Organization for Economic Cooperation and Development (OECD) and urged them to be realistic about the outcome of the inquiry.
Dalziel said she had appointed independent consultants Hale and Twomey to review the oil companies’ pricing mechanism because of a popular “gut feeling” that pump prices in New Zealand rose quickly when international crude oil prices increased but took a long time to fall when they dropped.
“Those are the questions that we’ll be looking at as to whether there are competitive pressures that are not being applied or whether there is some collusion cartel behaviour between the oil companies,” she told Radio New Zealand.
Dalziel said the economic development ministry monitored petrol prices but there might be room to improve the monitoring.
The price of the most popular 91-octane petrol is about 2.11 to 2.13 New Zealand dollars (about $1.60) a litre in New Zealand cities, 35 percent higher than a year ago.
The companies change petrol prices suddenly and usually uniformly. They have risen by up to 24 cents a litre since early May, when the Automobile Association began calling for an inquiry into the New Zealand fuel market’s pricing structure.
The association wants New Zealand to adopt a regulation being tested in Australia that forces the oil companies to give 24 hours notice of price rises, enabling motorists to fill their tanks before they take effect.
Tags: automobile association, collusion, commerce minister, crude oil prices, development ministry, development oecd, economic cooperation, fuel market, gut feeling, independent consultants, international crude oil, lianne dalziel, member organization, new zealand dollars, new zealand government, oil companies, organization for economic cooperation and development, radio new zealand, twomey, zealand cities