Global oil crisis: Why New Zealanders shouldn't panic just yet

Kiwis are being urged not to panic over fuel prices just yet.

The Automobile Association (AA) believes fuel prices will come back down, following the Saudi Arabia oil drone attacks.

BP and Z Energy both increased its petrol and diesel prices by 6c per litre, but Gull is holding off making any changes just yet. 

AA spokesperson Mark Stockdale says fluctuations in price are a part of life.

"We've certainly had higher prices in the recent past, and this time last year prices were closer to $2.50 per litre," he told Newshub. "And that had nothing to do with any reduction in supply out of Saudi Arabia."

Stockdale said the price hikes were likely to be short term.

"There are other oil producers that can increase their production if need be," he said. "So this is not likely to be a long term issue in the scheme of things.

"I think globally, the markets will be able to respond to the reduction and supply out of Saudi Arabia."

Stockdale told Newshub it was a good move by Gull to hold off on hiking prices.

"It has gone up, but it could drop back a little bit, or it may go up a little bit more, and it's better to have those increases spread over several days, [rather] than one big hit in one go."

However, economists are warning that these price increases could just be the beginning, and massive price hikes could be on the cards.

Kiwi economist Cameron Bagrie said the worst-case scenario would see prices skyrocket to $3 a litre. 

"Saudi Arabia in regards to the oil industry around the globe, is about as strategically important as Beaden Barrett is to the All Blacks or Steve Smith is to the Australian cricket team," he told the AM Show on Monday.