Petrol price increase likely soon

Press, 23 April 1980, Page 2

Petrol price increase likely soon

PA Wellington The retail price of petrol is expected to rise by another 7c a litre but oil-indus-try sources do not expect this to happen until July at the earliest. The next price increase would probably be announced in the Budget, due in late June, said the sources yesterday. . , The oil companies have not yet formally asked for a price increase. The supply situation, is particularly confused at present and they are unsure of which way prices for crude will go. The last petrol price rise was on February 11 when the wholesale price rose by 4.83 c a litre, and the retail margin

by 0.17 c. The oil companies had asked for an increase of 7c 'and the retailers 2.31 c. Petrol today costs 48c a litre for premium grade. The February‘use took into account increases in the price of crude until about September, 1979, and the oil companies now are looking to take up the slack. Since February the price of Saudi Arabian light crude, which is mainly what New Zealand imports, has risen by SUS2 a barrel to about. SUS2B. The oil-company sources said part of the problem was that the oil sellers insisted that a certain amount of oil be bought on the spot market instead of the contract market rate. In the last month the spot-market rate had weakened but in the last week indications were that it was firming again. The oil companies expect to lodge applications soon for price increases of about the same size as their February applications. The executive director of the Motor Trades Association (Mr T. Bates) said yesterday that the retailers would also seek an increase in their margin.