Thoughts - Price of petrol in 2022

[treone 648]

What's the thinking out there regarding the current increases, and continuing increases, to the price of petrol?

To be clear - No this thread isn't intended to debate what's happening in Russia-Ukraine (but I'm in no way endorsing the situation).

And no its not a ICE v EV (or the end of ICE vehicles) debate either.

Just curious on the thoughts out there but I do ask to be 'pleasant' and 'respectful' when expressing them.

Cheers.

[Jacko 2156]

The 1.5l toyota that sips 91 will be seeing far more km on the odo...

[C-130 Hercules 571]

It has already been skyrocketing before the 'special military operation'. However, I think what Putin has set in motion has a lasting effect on the world we knew. Not something we can turn the pages back on. 

Influences on oil prices are complex. Supply, demand, geopolitics, and, I would argue,  investors/speculators. 

In focusing on the positives - it saw me take both cars out today. But on the way home was thinking that one day it might take us $1000 to fill up our 'classic' cars... 

Edited March 11, 2022 by C-130 Hercules
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[Eagle 1662]

Price of everything has gone up considerably in these last couple of years. Fuel just taking the spot light currently. Reduced vehicle usage is a good thing but i do feel for poorer people who can't wear the added cost.

[Jacko 2156]

Also this getting some work  

[gjm 3258]

The cost of fuel at the pump has increased dramatically over the last few months. There was the usual big money-grabbing increase before Christmas, sustained through New Year, and a slight drop in early January.

Since then though, it's been an inexorable increase. 1c/litre a day looked to be an average at one point.

Lots of the usual noise about how bad the NZ govt is at managing this, and the tax they're taking. Yes - it's a significant contributor, but if the fuel companies didn't increase price, the govt percentage wouldn't compound the problem.

I've said elsewhere that a cap on govt taxation would be a way that the public can be helped. Take a time and price - let's say $2.50 per litre - and once the price of fuel reaches that, the government doesn't take any further tax. However, that doesn't address any transparency issues that the public may have regarding what the oil companies are making vs govt taxation.

A better way would be a fixed amount. Without going through all the tax take calculations, let's say the govt takes $1.50 tax on a litre of fuel. A huge amount of money to be sure, but we could expect the govt to be able to say that 30c is spent on x, 27c on y, 2.6c goes towards wrestling mats for one-legged black lesbian mothers of three or more children, 40c goes towards... whatever. Fix that figure. Any change in fuel price is purely and simply at the behest of the oil companies, and is clearly calculable and obvious.

It's also far, far simpler for the govt, the filling stations, and so on. It can 'hide' any cents/dollars per barrel taxation, but the public won't care about that. They'd have a clear view of the tax take.

Refineries... Lots of fuss and blame being laid at the govt feet for the closure of Marsden Point, a privately owned entity. All the fuss about that, and the offshore barges - all private owned/used. No govt involvement. Should there be? Maybe.
Australia is nearly 30x the size of NZ, and has 4 refineries for the entire country. From an Oz standpoint, an area the size of NZ doesn't warrant consideration, and certainly not it's own refinery.

Finally... Profit. Oil companies are raising prices at a time when they are making ever-increasing profits. Oil companies are also taking subsidies from governmental institutions... And they're not paying a 'reasonable' amount of tax on the profits they are making - lots of offshore obfuscation around ownership and finance.

Clever move by the petrol stations. Announce a price increase, empty the filling station tanks so they can fill right up while they can still get fuel relatively cheaply, and then hike the price up to what the new barrel cost is.

There's a LOT going on in this area. A lot of behind-the-scenes long-term planning, all the way down to individual and corporate profiteering with taxation somewhere in the middle. It's incredibly complex.

[treone 648]

Agreed!

The 'pain on the wallet' is not exclusive to filling up at the pump. The expense, and availability of 'everyday' consumable items will make if difficult for quite a few in the future, if not already.

As mentioned it is very complex!

[tawa 150]

These are strange economic times we live in. Seems like pricing on so many different things is getting so far distant from what the cost of said thing is. The oligopolies and taxation seem hard at play for fuel pricing. But in contrast to many things, incentivizing less driving is of benefit to wider society, reduce congestion on the road, free up our time from commuting, help the polar bears.

I don't see much likelihood of what has driven the pricing up being reversed either, sure there might be some reductions in the overall upwards trend, but as Julian said, $1000 per tank is probably on the horizon, sh*t I'm a quarter of the way there already with the X5.

[Kees 594]

The news this morning has had me looking at frugal diesels for longer trips. I have access to a Smart Fortwo for around town activities which it handles superbly. However, on the open road you do feel a bit vulnerable in a Smart car, especially with the quality bumpy roads which make it hop and shift around the road like a grass hopper. 

Wish I had bought the manual 320D touring that was for sale a few weeks ago! Can't seem to find many decent modern(ish) manual diesels for under $7K. Have noticed the price of hybrids and electric cars going up too. I remember when BMW i3s could be had for under $30K. Now the cheapest is a little over $30K... 

I'm about to buy a battery charger because I can see my 540i getting minimal use this year. Last year it wouldn't sit for more than two weeks ever, and was usually driven a couple times a week (as it is stored away in a garage away from my house so I would swap cars and keep it for the weekend). I did over 5000km in it which I thought was pretty solid considering the lockdowns and what not. 

I also wonder what ramifications of the petrol prices will be seen in the car market. My guess is that really desirable and rare stuff (i.e manual 911s, e39 M5s etc) will remain at their current prices or continue to appreciate, but more common stuff like W204 C63s which had been regularly seen doing daily duties in the past, will soon flood the market as people can't afford to run them, and don't see the value in having them as a weekend toy. 

I think people may also think twice about buying a weekend car as they struggle to pay for fuel in their daily drivers. Although on that vein of thought; desirable weekend toys like M3s etc. may become more desirable as more people switch to super mundane daily drivers like Leafs etc and subsequently crave a really special and engaging machine for the weekends. In which case your average daily driver that isn't particularly fuel efficient will potentially be worthless. Only time will tell though! 

Without getting too political it doesn't take a genius to understand that minimum wage rising is just going to boost inflation further. Costs of production will increase for firms that are already on their knees, and of course that extra cost will be largely passed onto the consumer. It does not take a genius to interpret that minimum wage rising is going to hurt low income earners more than benefit them! 

I would not be surprised if we have protests very soon pertaining to the cost of necessities because it genuinely is out of control. 

Let's just say I'm counting down the days until the next election. 

[Sammo 2544]

Luckily I don't do too many miles in the thirsty E30 - chuck $50 of premium in every few weeks and its all good.

Wife advised however it was $190 to fill the even thirstier Audi today which was a bit of a shock - I do have a work fuel card but don't like to thrash it too much, especially mainly working from home these days.

Maybe a modern small displacement turbo for her next - PHEV would be nice but we only have one off street park and that is for the E30.

[E30 325i Rag-Top 2957]

Has the price of petrol gone up or something? I hadn’t noticed, would have thought someone might have mentioned it.

[balancerider 758]

On 3/11/2022 at 7:58 PM, gjm said:

A better way would be a fixed amount. Without going through all the tax take calculations, let's say the govt takes $1.50 tax on a litre of fuel. A huge amount of money to be sure, but we could expect the govt to be able to say that 30c is spent on x, 27c on y, 2.6c goes towards wrestling mats for one-legged black lesbian mothers of three or more children, 40c goes towards... whatever. Fix that figure. Any change in fuel price is purely and simply at the behest of the oil companies, and is clearly calculable and obvious.

We already have RUC's for diesel vehicles (although the per km rate is pretty brutal for light vehicles <2t) - wouldn't be hard to expand this to all vehicles which would make the taxation very transparent. I foresee a combination of RUC's and congestion charging in the future.

[m325i 709]

On 3/11/2022 at 6:16 PM, treone said:

And no its not a ICE v EV (or the end of ICE vehicles) debate either.

At this point it is. 

 

[Kees 594]

22 minutes ago, balancerider said:

We already have RUC's for diesel vehicles (although the per km rate is pretty brutal for light vehicles <2t) - wouldn't be hard to expand this to all vehicles which would make the taxation very transparent. I foresee a combination of RUC's and congestion charging in the future.

I'm just waiting for the day the Government introduces some arbitrary registration system based off something like engine displacement, where you pay more for registration the bigger your engine is. Can see something like that happening very soon. 

[E28E30 335]

We used to have registration bands based on safety ratings or similar but they got rid of that.   Next step could be UK-style emissions bands which could be in the mix?

[aja540i 1906]

22 minutes ago, Kees said:

I'm just waiting for the day the Government introduces some arbitrary registration system based off something like engine displacement, where you pay more for registration the bigger your engine is. Can see something like that happening very soon. 

Isn't that covered by the fuel tax? Bigger engine = more fuel = more tax. Seems to be a reasonably effective way to steer people towards smaller, more efficient vehicles.

[E30 325i Rag-Top 2957]

Yup, that and the whole Clean Car Scheme - although that only focusses on first registration, by steering the first purchase that then determines the subsequent re-purchase decision.

[dirtydoogle 383]

I'm glad I got my mundane hybrid for 3k now. 

I'm not too worried personally because my toy vehicles are either very economical, or they probably will be finished anyway. 

 

[gjm 3258]

2 hours ago, balancerider said:

We already have RUC's for diesel vehicles (although the per km rate is pretty brutal for light vehicles <2t) - wouldn't be hard to expand this to all vehicles which would make the taxation very transparent. I foresee a combination of RUC's and congestion charging in the future.

Agreed.
I'd focused on petrol-engined vehicles.
The existing RUC charge is unreasonably harsh on those with private, smaller-engined diesel and mostly economical vehicles. It's simply not been changed to accommodate the change in diesel engine technology.

EVs are going to see an RUC introduction at some point. It'd make sense to extend this to all road-using vehicles.

[lord_jagganath 421]

filled the ActiveHybrid up with 98. $205 for 58 litres. first time it has ever breached the bicent mark; i'm good for another 600 ks, if driven miserly.  works out to me spending $15 a day on fuel to commute. I should buy a leaf (too late, the prices for those have doubled) 

[gjm 3258]

1 hour ago, lord_jagganath said:

filled the ActiveHybrid up with 98. $205 for 58 litres. first time it has ever breached the bicent mark; i'm good for another 600 ks, if driven miserly.  works out to me spending $15 a day on fuel to commute. I should buy a leaf (too late, the prices for those have doubled) 

I was looking at an X3 diesel. Claimed 1000km+ on a full tank. (Can't confirm!)

So that's $72 in RUCs, and (at $2.30 per litre) $154 for the diesel. $226 for (in my case) little more than a week of driving.

A 2.0 petrol-engined car will take around 40l of fuel, 3 times in a fortnight. At $3 a litre, that's $180 a week, based on same usage.

From an economy perspective, a diesel stops making sense very quickly.

Edited March 12, 2022 by gjm

[treone 648]

3 hours ago, m325i said:

At this point it is. 

Was wondering how long it was going to get there - oh well, fair enough haha 😁

At least it hasn't got to 'it's part of 'the establishments' master plan to inflate petrol/oil prices along with the introduction of the gas guzzler tax (or whatever its being called) to make the national shift to EV's - oops sorry - a younger, less polluting and more efficient national fleet faster' theory. Just saying 🤣

I have to admit that this is the first time I've contemplated a more 'fuel efficient' alternative as it will get a lot more painful running a bunch of V8's - but the smile factor! Even have thoughts of a diesel or, yup I'm saying it, an EV - the in-laws electric trike is looking like an attractive proposition!! 

But in all seriousness, for me, the part I'm most worried about is the ripple effect and the impact this will have on certain groups in our society. Its tough now but things will only get... a perfect storm is a brewing...

[NZ00Z3 187]

[balancerider 758]

7 hours ago, gjm said:

I was looking at an X3 diesel. Claimed 1000km+ on a full tank. (Can't confirm!)

So that's $72 in RUCs, and (at $2.30 per litre) $154 for the diesel. $226 for (in my case) little more than a week of driving.

A 2.0 petrol-engined car will take around 40l of fuel, 3 times in a fortnight. At $3 a litre, that's $180 a week, based on same usage.

From an economy perspective, a diesel stops making sense very quickly.

Non SUV BMW 2.0d will comfortably do 5.5L/100k in mixed driving and probably <5 if all open road so shifts the equation favourably. No doubt in my mind a small capacity diesel is more economical than a petrol in the same vehicle (if you’re doing open road km), especially with any use of the throttle.

[lord_jagganath 421]

9 hours ago, gjm said:

From an economy perspective, a diesel stops making sense very quickly.

depends on commute and diesel car type. I hoofed the Q7 very quickly as it was barely warming up ( peak covid lockdown traffic) so was being very inefficient, but the VW CC i had was sweet as I sat in traffic a lot then.  with stop start systems and better diesels, it is possible to get far better mileage.