The Commerce Commission will ramp up its scrutiny on fuel companies to ensure price increases are fair, and "will not hesitate" to call out unjustified increases, it says.
Commissioner Bryan Chapple said more frequent reporting will be used to call out any pricing behaviours which give the commission cause for concern, both publicly and directly with fuel companies.
The commission said this response is due to the more volatile global wholesale prices, which had become a concern due to the war in Iran.
Iranian mine-laying vessels attacked after apparently trying to cut of the crucial supply route. (Source: 1News)
Chapple said public scrutiny is a "powerful tool" and "we will use it".
"Nobody wants to see fuel companies using the situation in the Middle East as an excuse to unjustifiably increase prices at the pump.
"Any retail price increases should be aligned with actual increases of sourcing fuel. I have communicated that message directly with fuel companies."
While the commission does not set fuel prices and does not control them, its role is to monitor, report and hold companies to account through transparency and scrutiny, ensure the sector remains competitive and representations around pricing are fair and accurate.
Reports will be available on the commission's website, which would provide updates on retail fuel price movements and compare them with the changes in the cost of importing fuel.
Chapple encouraged Kiwis to shop around and compare prices.
An initial aggregate analysis released by the commission today found no concerns currently.
"The gap between rising international costs and slower retail movements aligns with patterns seen during previous global shocks but it is not a licence for fuel companies to increase prices excessively."
Chapple said the commission would also be looking at variations in regional pricing, and would continue to monitor price movements, and call out any pricing behaviour which appeared unjustified.
Fuel surcharges to be monitored
Chapple said placing a fuel surcharge on a product or service was legal so long as the business was transparent and upfront about the surcharge and what it is for.
"We expect businesses to do the right thing, and they must be honest about the reasons for any price increase."
He encouraged anyone who believed a business had been misleading on the reason for a price increase to report it via the "raise a concern" function on the Commerce Commission website.
Previously, the commission had used its monitoring role in regions such as Thames and Waiheke, where it said transparency and scrutiny contributed to greater competition on pump prices for consumers.
So, what do fuel companies say?
Energy (Z) said it was closely monitoring the rapidly evolving situation in the Middle East while the impact on supply here was still small.
"At this stage, the impacts on Z’s ability to supply our customers remain minimal," a spokesperson said.
"However, global energy markets remain highly volatile and, to the extent the situation in the Middle East remains unresolved, we can expect to see growing pressure on global fuel supply chains. We continue to monitor actively the developments in global markets and assess their implications.
"As a local company, we are committed to New Zealand customers and prioritising their fuel needs. As part of the Ampol Group, Z benefits from a diversified and resilient supply chain, supported by refining capability, access to global markets, and robust critical infrastructure."
A BP spokesperson said it was also monitoring the situation closely but, "there are a number of factors that influence prices".
"We continue to review bp Connect prices every day to ensure competitiveness in the market. The bp website has more information on the facts about fuel pricing. There are also a number of independent bp operators all around the country who set their own prices and manage their own operations."
Thousand-plus flights cancelled due to fuel costs
Air New Zealand announced today it would be cutting around 1100 flights from its domestic schedule as it responds to rising fuel prices caused by the war.
Chief executive Nikhil Ravishankar said it would be a roughly 5% reduction in services through until the start of May – around 1100 flights affecting 44,000 passengers.
Most of the passengers would be moved onto other flights. The cancellations were likely to be off-peak services and be mostly domestic.
‘Unprecedented’: Air NZ CEO addresses fuel crisis as 1100 flights cancelled - Watch on TVNZ+
"We're focused on consolidating flights that are off-peak flying hours, for example, or where there is an alternative that we can re-accommodate customers," he told 1News.
Air New Zealand was not looking at cutting routes.
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