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New Zealand report clears oil companies of cartel practise

Business Materials 7 August 2008 07:02 (UTC +04:00)

(dpa) - Big oil companies were cleared of suspicion of running an illegal anti-competitive cartel in an independent investigation into New Zealand petrol pump prices released Thursday.

The report showed that the New Zealand petrol market was "fundamentally competitive," said Commerce Minister Lianne Dalziel, who commissioned the study after angry motorists' complaints about a 30-per-cent increase in prices within five months.

The price of the most popular 91-octane petrol reached 2.18 New Zealand dollars (about 1.57 US dollars) a litre last month in New Zealand cities, a rise of 60 per cent since January 2007.

Dalziel said at the time that there was a popular "gut feeling" that pump prices rose quickly when international crude oil prices increased but took a long time to fall when oil prices dropped.

The study showed this was "just a perception," she said.

"In fact, the rise and fall in petrol prices mirror changes in offshore drivers, such as the price of crude, the value of the US dollar, as well as simple supply and demand, which all impact on the price at the pump here."

Dalziel said that New Zealand had the fifth lowest pump prices in the 30-member Organization for Economic Co-operation and Development (OECD) after Mexico, the United States, Canada and Australia.

She said that officials were working on ways to show more transparency about importer margins, the difference between the retail price (less taxes and duties) and the landed cost of the refined product.

"This is an area where we can offer better information for consumers," she said.

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