In September I wrote a blog post here about the price of crude oil and how it was falling and yet the price of fuel at the pump was not dropping. Since then I have recieved over 200 emails from readers who have all voiced their opinion in this matter and I think they all have a point.
When the cost of crude was going up in record speed the price of fuel also went up at record speeds. The price increases were passed onto the consumer almost instantly. After a while I wrote a letter to the New Zealand Herald and they ran a story which appeared on the front page which went on to say fuel was about 30c more expensive than it was comparatively when the crude oil was at that level. Now crude oil is half what it was then and we were paying 1.89 then.
Crude has more than halved since then and is less than 1 quarter of what it was worth at the peak in July 2007 when it was $146USD. Crude Oil today is $35 USD a barrel. Although our dollar has dropped back you have to look at the figures. In the past two weeks the crude price has dropped almost $15USD and our New Zealand Dollar has gone up almost 5 cents. But we have not seen any movement at the pump price. It has been $1.39 for about 3 weeks now.
I have been following the price of fuel vs crude oil when it was rising and both when it has been falling. A barrel of crude in New Zealand will be $61. This is actually $9 less than it was yesterday due to the rapid drop of crude oil prices. I believe that the price of 91 Octane should be approx .85c per liter and that is taking into consideration our lower New Zealand Dollar. I am sick of us all been taken for a ride on the price of fuel at the pump by these big oil companies. The price is over .50c more than it should be, there is no way you can deny that at all. We are paying too much at the pump.
But is this a sign of times to come as well. Is the price of crude dropping, the speed at how it has dropped and the continuation going to be a reflection of what the houses prices and the economy will be doing in 2009. It makes you think again doesnt it….