Transport Minister Michael Wood doesn't rule out fuel tax cut extension after last week saying it will end in January

The Government could "consider" extending the fuel excise tax cut in January if multiple global factors come to fruition and prices begin to skyrocket, the Transport Minister says.

That's despite Michael Wood last week saying the tax would be reintroduced at the start of next year. 

It comes as New Zealanders are warned petrol prices could rise "well over" $3 per litre when the Government's 25-cent fuel excise tax cut ends and if sanctions on Russia continue increasing.

At a meeting on Thursday, the Organization of the Petroleum Exporting Countries (OPEC+) also agreed to slash output by 2 million barrels per day - which was expected to push prices higher.

"I'm really concerned when I look at one event that's going to occur in early December… What's happening is sanctions are being applied to the reinsurance of Russian oil that is in tankers on the water," said Terry Collins, principal policy advisor for New Zealand's Automobile Association.

"That will have quite a significant impact on the prices," he told AM on Friday.

"You put on that insurance problem on there, then at the end of January, you put on the 25c… then in March the Europeans start sanctioning refined product coming out of Russia.

"I do see a slow, upward pressure on oil prices and the only thing that would perhaps stop that is the threatening recession," said Collins, who believed costs could rise "well over" $3 per litre and closer to $4 for higher octane fuels.

New Zealand's tax reduction, which came into effect earlier this year, was set to end in January - with Wood saying exactly a week ago it won't be extended. 

But, speaking with AM on Friday, he did not rule out an extension.

"As we discussed last week… we have put $1 billion of support in over the last year to have a reduction in fuel excise duty and road user charges - that does come off in January and, at this stage, that comes off," Wood told host Ryan Bridge.

"Obviously, if we get into next year and there are new circumstances we need to consider, we consider those as they arise - we can't cast ahead and predict exactly what's going to happen in February/March next year."

The average per litre price for 91 octane at New Zealand stations, as of last Friday, was $2.50 per litre - which has remained relatively stable for a month or so.

Wood said the tax cut was only funded through January, but "obviously if we get into next year, if we face changed circumstances in any area, we consider those".

He added the Government had "always said" the tax cut couldn't continue indefinitely.

"I think people understand that," said Wood.