Exchange rates and petrol prices

The below is from an entry I made at my main blog, based on some very basic maths after reposting a graph from the Historian’s blog.

Just last week I was listening to the radio—one of the foreign-owned stations that seem to populate the FM airwaves (probably Coast)—and the DJ gave one of the less intelligent commentaries about oil prices I had heard. He also referred to ‘gas prices,’ which of course is the incorrect term here where gas refers to gas, not petrol or gasoline.
   Petrol prices in New Zealand rise and fall based on American news—something that is not that relevant when it comes to how much we pay for oil. When there is a rise in the US dollar oil price, but the New Zealand dollar has strengthened over the same period, then that rise should not be felt at the pump as greatly.
   Let’s assume oil prices are at US$120 a barrel and there is no inflation between 2000 and 2008. (Of course, it was less than $120 in 2000 and more than $120 now.)
   In 2000, with the New Zealand dollar at an all-time low against the greenback, we would have had to fork out NZ$300 to get that barrel.
   In 2008, with the New Zealand dollar having gone back to around 1982 levels against the greenback, the equivalent is NZ$154.
   So for a New Zealand company buying oil, it actually costs less.
   However, I am ashamed to note that once you factor in the real prices, we are looking at these figures:

2000 price of crude, US$27·39 (real, not adjusted), equalling NZ$68·48
2008 price of crude, US$134, equalling NZ$171·79

Pump prices—and I know I am ignoring refining costs and a whole bunch of other stuff—are:

2000: NZ$0·97 per litre
2008: NZ$2·14 per litre

This actually means the rate of increase New Zealanders are experiencing is not as bad as the oil prices offshore based on New Zealand dollars, even if our prices are rising more quickly than Europe’s.
   While the Americans, relative to their dollar, are paying four times more, we are paying just under three times.
   Whatever the case, I think it’s worth informing the public—especially on whom we might be able to blame these price rises. And that demand and supply have nothing to do with these high prices, because demand is actually dropping—so we can stop blaming the Americans for their big SUVs and the Red Chinese for buying new cars.
   The targets are most likely the speculators, institutional investors, price fixers, the corporations and the cartels.
   And it seems to lend some weight to isolating a small country from these threats, globalizing where it makes sense—and in other areas, developing a better model in isolation to show the world how things might be done.