Minister says 'we're not even close' to calling on crude oil reserves after attack on Saudi fields

Energy Minister Megan Woods says New Zealand has a month's worth of crude oil held offshore, her comments coming as the massive attack on oil fields in Saudi Arabia is expected to bring a sharp increase in petrol prices as early as Tuesday. 

Your playlist will load after this ad

The crude oil price surged today then dropped slightly and Megan Woods says NZ is not at crisis levels. Source: Q+A

Some analysts predict prices at the pump in New Zealand to jump by up to 10 cents a litre, following the weekend drone attack on the world's largest crude oil facility that knocked out more than five per cent of the global supply.

The global crude price surged by 20 per cent today, then dropped slightly.

But Ms Woods told TVNZ1's Q+A the futures price was down to $US58, largely because the US released some of its strategic reserves which has countered "some of the anxieties" the market was feeling earlier in the day.

She said her analysts tell her a dollar rise in a barrel means about a cent at the pump for consumers. That would mean today's rise of $US6 a barrel would mean about six cents at the pump.

But Ms Woods said "we're not even close" to the International Energy Agency starting to release strategic reserves of oil New Zealand holds offshore.

"We've got basically a month's worth of oil, crude, that is held offshore that we can bring in. So it's that forward planning really that we can activate," she said. 

"But we'd have to see prices rise by about $US20 a barrel in order for some of those strategic reserves to be released. So we're not close to that."

Your playlist will load after this ad

President Trump is threatening retaliation over the drone attack. Source: 1 NEWS

Ms Woods said it's a case of waiting to see what the Saudi oil minister has to say on Tuesday about the likely timeframe for restoring production.

Meanwhile, the Government appears unlikely to remove the Auckland regional fuel tax if there's a sustained period of significant increases at the pump.

Ms Woods said she got advice on this today and it's not something the Government has done in the past or is considering now.

She said from 2011 to 2015 the price per barrel of crude was between $US100 and $US120, whereas today it's $US60 to $US70.

She said the Government didn't take tax off petrol in the four years from 2011 for good reason - the money is used to pay for roading and transport infrastructure.