Energy and Resources Minister Judith Collins has today announced a Market Study into fuel prices/returns to be undertaken by the Ministry of Business, Innovation and Employment (MBIE).
The Fuel Market Financial Performance Study, which is expected to be completed by the end of June is designed to determine how fair petrol and diesel prices are at the pump.
“MBIE data shows that fuel margins have more than doubled over the last five years. The Market Study will report on fuel company returns and will include in-depth analysis of oil companies’ finances.
The Study will focus on the returns on average capital employed against cost of capital, across different parts of each business. It aims to determine if companies are making super-normal profits or not. Other financial benchmarks may also be used.
“The advantage of a Fuel Market Financial Performance Study is that it can be done reasonably quickly and it will help to build a more informed picture of the overall performance of the fuel market. However, it will require the industry to cooperate with MBIE.
“I have spoken to the oil companies this week and I am very confident that they will work with MBIE and provide the required information in a timely manner. It is in the best interests of everyone, including oil companies, to make sure New Zealand has quality, reliable and reasonably priced fuel,” Ms Collins says.
The terms of reference for the Study are being consulted on with industry and will be finalised and released shortly.