The Commerce Commission is wanting answers from petrol companies over what it calls "anomalies" in retail fuel pricing over the first year of a new regulatory regime.
Following a market study into the fuel sector, the Government established a regulatory regime aimed at promoting competition in the industry in an attempt to benefit consumers.
Commission chair John Small said the latest Quarterly Fuel Monitoring Report for the period ended March 31 highlighted pricing differences between cities and towns, and within centres themselves.
Some of the pricing levels and variations were "concerning, with no clear underlying factors".
Business Correspondent Katie Bradford takes a look at what the consumer watchdog can do if it's not happy with the response from petrol companies. (Source: 1News)
It was seeking information from fuel companies on how they are setting prices, in a bid to find out if the prices can be justified based on costs or other factors.
“We are seeing wide variations in prices both between and within cities, and these pricing differences do not appear to be explained by differences in the underlying costs," Small said.
"We’re writing to all the major fuel companies in New Zealand to ask them to please explain what we’ve seen in some of the pricing levels observed as part of our analysis feeding into Quarterly Fuel Monitoring Reports.
"In a competitive market, we’d expect to see prices at the pump reflect the cost of supplying fuel at the pump, whereas what we are seeing is retailers in some towns and cities charging a lot more for what is essentially the same product with similar cost components."
Z responds
Z Energy said the fuel distributor prices their fuel competitively, "with the aim of offering value and service to our customers".
"The Commerce Commission’s statement, which talks to the variation in prices at the pump between cities and towns, shows healthy market competition in action," he said.
"An upshot of competition in retail fuel markets is that there is price variability, as companies change their pricing and compete for sales in different ways. This variation will continue to fluctuate as you would expect in any competitive market."
Clarke said Z reviews its pricing daily and makes up to 50 price changes daily outside of any nationwide moves.
"Z’s fuel pricing is localised, which means that prices can be different at service stations within regions or even the same towns based on a range of factors such as varying property overhead costs or local competition.
"At Z, the prices are set by head office not by the individual service stations."
Clarke did however not that Caltex service stations, which are managed by Z Energy, are independently owned with retailers setting the final price at the pump.
He encouraged customers to use apps like Gaspy to find the cheapest fuel in their area.
Clarke said Z has actively engaged with the Commerce Commission under the 2020 Fuel Industry Act, and is "proactively sharing information to help provide insight into the highly competitive fuel market".
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