oil prices below $50 a barrel!! still no price cut!!

Cardew

logie28 wrote: »

Cant remember when i set a level for debate, certainly was not my intention or desire to debate with energy company sympathisers or employees.

The facts speak for themselves , so really no room to debate! The energy companies are over charging at this present moment in time. End of really.

I'm mearley asking why? still not had a constructive reason, even off yourself.


If there was a genuine reason for why prices had not fallen. A reason which was fact. Backed up by figures and reasons, I'm pretty sure the energy companies would be shouting out loud.

Press releases, billboard adverts, advertisements in the press and even letters to the customers.... you know,,, all the things they do at the drop of a hat when the global markets are rising.

What i'm asking is... it should work both ways.. information or a price cut prediction when markets are low.

Not a lot to ask for really ... in fact shouldn't really have to ask.. after all we dont need to ask when the markets are soaring... do we?

Firstly I am not, and never have been, in any way, shape or form connected with the energy supply industry.

Silly phrases like "energy company sympathisers" are the prerogative of The Troll - which is why many of us ignore him.

What that phrase really means you can't have rational debate so dismiss any counter-argument.

If there is "no room for debate" why come onto an internet forum?

Or do you just want a nice rant with everyone agreeing with you - even if you are completely wrong. Why produce incorrect facts about 2004/5? Surely if there is "no room for debate" you don't need to bolster your argument.

Far from "the facts speak for themselves", the only facts you have produced have been shown to be incorrect.

You have produced nothing except to rant at high prices or try to deliberately misinterpret posts.

Of course the companies have replied to all the media comments about pricing, either from company spokesmen or the Energy Retail Association.

http://www.energy-retail.org.uk/

Now they look after the interests of the Utility companies, so of course they are biased (and their Media chief has been a disaster when I have heard him speak)but they dare not tell lies!

Throw away remarks on price increases like "Things they do at the drop of a hat" are simply not true. Price increases have always lagged a long way behind wholesale energy price rises.

Let us get one thing straight, the energy prices we pay are too high and they must come down and IMO will come down.

It is stated that energy prices are linked to the oil price. People seem to argue on this forum that this is a direct linkage, e.g. if oil rises/falls by x% then our energy should rise/fall by x% and this isn't so.

Taking the statistics you posted earlier. In 2004 oil was $37 a barrel and we were paying roughly 2p/kWh for gas and 7p/kwh for electricity(tier 2 prices).

If your statement that the companies raise prices 'at the drop of a hat' were true, earlier this year when oil hit nearly $150 we would have been paying around 9p for gas and 30p for electricity(tier 2 prices) e.g. roughly 3 times more than we are paying.

logie28

posted by cardew
If there is "no room for debate" why come onto an internet forum?
I said " below $50 a barrel why no price cut" there is a question, i.e a prompt for debate. What i ask for is a ligatamate responcse with substanse and fact.


The reason i say to you, "no room for debate" is because you can not put forward a constructive reason why prices should fall, indeed no one can!!

Or do you just want a nice rant with everyone agreeing with you - even if you are completely wrong. Why produce incorrect facts about 2004/5? Surely if there is "no room for debate" you don't need to bolster your argument.


Yep i do want a rant, about being ripped off.

Being completely wrong!! me !!

about the price per barrel being below $50 ? being overcharged? in response to your 2004-5 question... why dont you answer my previous question about 2004-5 energy price.? If you read my previous posts i justify my reason for mentioning this.... you dont!!!!!!!!!!!

Of course the companies have replied to all the media comments about pricing, either from company spokesmen or the Energy Retail Association.

http://www.energy-retail.org.uk/ try giving a link to one of the big six ( who are not in bed together) why cant they directly represent them selves?

Now they look after the interests of the Utility companies, so of course they are biased (and their Media chief has been a disaster when I have heard him speak)but they dare not tell lies!
you slam people who talk of a cartel!! Why when you quote and give links do you talk of associations or bodies looking after utility companies.. all working as one being represented as one,,,, sniff,, sniff,, mm . time for you to produce the facts me thinks.

Let us get one thing straight, the energy prices we pay are too high and they must come down and IMO will come down.


Hold on ,, if you look at the thread, this is what i origianlly ask the answers for!!
so once again you contradict yourself, you talk of debate then you want the same out come?

logie28

Cardew wrote: »

Taking the statistics you posted earlier. In 2004 oil was $37 a barrel and we were paying roughly 2p/kWh for gas and 7p/kwh for electricity(tier 1 prices).

If your statement that the companies raise prices 'at the drop of a hat' were true, earlier this year when oil hit nearly $150 we would have been paying around 9p for gas and 30p for electricity(tier 1 prices) e.g. roughly 3 times more than we are paying.

If you look at your own statistic , we are not far off $ 37 a barrel now, a lot closer than we was at $147 a barrel.

I'm sure most people are paying no where near 2p/kwh for gas or in fact 7p/kwh for electric, so your argument doesnt really hold ground... does it,, in fact it proves you know how we are royally being ripped off at this moment in time. yet you still wish to contradict yourself!!!

logie28

BG price fix 2012 , credit price monthly DD,,, 8.123 per kwh tier 1.. scary that,, even with your predictions at $150 a dollar we would pay 9p for gas...


I just clicked on BG site, checked out their "best buy" 2012, looked at price check, selected credit on DD and was quoted this,, 8.123 p, per kwh.. tier 1, wow ,, at $48 a barrel,!! so you see , even with your calculations, they are charging 3 times to much

try it your self cardew..

( btw im on CE6) before i get advice on tariff

http://www.britishgas.co.uk/products-and-services/energy/gas/fixed-price-2012.html


thought we was talking facts????

PrinceGaz

Cardew wrote: »

It is stated that energy prices are linked to the oil price. People seem to argue on this forum that this is a direct linkage, e.g. if oil rises/falls by x% then our energy should rise/fall by x% and this isn't so.

Taking the statistics you posted earlier. In 2004 oil was $37 a barrel and we were paying roughly 2p/kWh for gas and 7p/kwh for electricity(tier 1 prices).

If your statement that the companies raise prices 'at the drop of a hat' were true, earlier this year when oil hit nearly $150 we would have been paying around 9p for gas and 30p for electricity(tier 1 prices) e.g. roughly 3 times more than we are paying.

I don't think anyone here would argue that the household gas, and even less so electricity price, that we pay should be directly linked to crude-oil prices as many other costs are involved. However, there is a close linkage between the crude-oil price and how much it costs to supply gas and also electricity to consumers and this is what matters.

In 2004, oil averaged around $38 a barrel throughout the year. In 2005, it averaged around $50 a barrel. In 2006 around $58, and in 2007, around $64. It was only the tail end of 2007 and early months this year that prices shot up, along with domestic energy costs numerous times.

After adjusting for inflation (I'll say 15% total over 4 years), we are now only a little bit above 2004 oil prices, and therefore also gas prices. So in theory, we should be paying only a little over 2004 prices, and certainly less than 2005 prices, plus the 15% inflation of course (which is negligible compared with how much more we are actually paying).

When the oil price was going up and up, what you say about us possibly paying 30p per KWh for electricity was certainly possible given how the regular price increases were being imposed (which is why sites like this recommended switching to capped tariffs) and if the oil-price had held steady at around $150 per barrel, I'm sure electricity prices would be nudged up ever closer to that level.

As the price of oil has crashed instead, the expected result would be the energy companies continuing their usual regular price-revisions every few months, probably by around 10% for electricity and 20% for gas. Except this time, the price is reduced for customers each time, not increased. Why are executives from the power companies not on TV informing us that "because of the falling price of crude-oil which is linked to how much we pay for gas, we are pleased to be able to announce a major reduction in domestic energy prices effective from next Monday"? That would be a major PR victory and would win many customers for the power company which did it first, but none of them want to as they are a cartel that want to hold prices artificially high so that they all win instead.

It's not like the power-companies in Britain are doing a good job at anything other than making money for themselves. Across most of Europe, electricity is much cheaper than in Britain. In France, it is a fraction of the cost we pay here thanks to the investment in the infrastructure and modern efficient nuclear power stations. All the energy companies are doing here is the minimum necessary to keep ever older power-stations running, with minimal investment in what we'll need in the years to come. The rest of the money is going to share-holders.

1carminestocky

logie28 wrote: »

BG price fix 2012 , credit price monthly DD,,, 8.123 per kwh tier 1.. scary that,, even with your predictions at $150 a dollar we would pay 9p for gas...


I just clicked on BG site, checked out their "best buy" 2012, looked at price check, selected credit on DD and was quoted this,, 8.123 p, per kwh.. tier 1, wow ,, at $48 a barrel,!! so you see , even with your calculations, they are charging 3 times to much

try it your self cardew..

( btw im on CE6) before i get advice on tariff

http://www.britishgas.co.uk/products-and-services/energy/gas/fixed-price-2012.html


thought we was talking facts????

Don't you dare question The Great Cardew/Hugh Jeego's (TM) word!! :eek: :eek: This is the man who invested in US property AND UK banks. The man is clearly a bloody genius....:rotfl:

Cardew

In post #62 I wrote Tier 1 prices and meant Tier 2 prices - so post has been edited.

Cardew

PrinceGaz wrote: »

I don't think anyone here would argue that the household gas, and even less so electricity price, that we pay should be directly linked to crude-oil prices as many other costs are involved. However, there is a close linkage between the crude-oil price and how much it costs to supply gas and also electricity to consumers and this is what matters.

In 2004, oil averaged around $38 a barrel throughout the year. In 2005, it averaged around $50 a barrel. In 2006 around $58, and in 2007, around $64. It was only the tail end of 2007 and early months this year that prices shot up, along with domestic energy costs numerous times.

After adjusting for inflation (I'll say 15% total over 4 years), we are now only a little bit above 2004 oil prices, and therefore also gas prices. So in theory, we should be paying only a little over 2004 prices, and certainly less than 2005 prices, plus the 15% inflation of course (which is negligible compared with how much more we are actually paying).

When the oil price was going up and up, what you say about us possibly paying 30p per KWh for electricity was certainly possible given how the regular price increases were being imposed (which is why sites like this recommended switching to capped tariffs) and if the oil-price had held steady at around $150 per barrel, I'm sure electricity prices would be nudged up ever closer to that level.

As the price of oil has crashed instead, the expected result would be the energy companies continuing their usual regular price-revisions every few months, probably by around 10% for electricity and 20% for gas. Except this time, the price is reduced for customers each time, not increased. Why are executives from the power companies not on TV informing us that "because of the falling price of crude-oil which is linked to how much we pay for gas, we are pleased to be able to announce a major reduction in domestic energy prices effective from next Monday"? That would be a major PR victory and would win many customers for the power company which did it first, but none of them want to as they are a cartel that want to hold prices artificially high so that they all win instead.

It's not like the power-companies in Britain are doing a good job at anything other than making money for themselves. Across most of Europe, electricity is much cheaper than in Britain. In France, it is a fraction of the cost we pay here thanks to the investment in the infrastructure and modern efficient nuclear power stations. All the energy companies are doing here is the minimum necessary to keep ever older power-stations running, with minimal investment in what we'll need in the years to come. The rest of the money is going to share-holders.

I certainly agree that prices will have to reduce if the oil price remains at current levels - I have stated that several times.

The only issue is when and by how much; and that depends on when the future supplies they bought at higher prices have 'worked through' the system.

My issue on this thread has been the ranting that excessive profits are the reason for our high energy prices.

You are correct about France investing in Nuclear and the French Government having some control of electricity prices.

However I don't think you are correct about Europe paying much less than UK for electricity - or gas. Or that France pays a fraction of our prices - in fact I believe French prices are comparable to UK*

The last figures I have seen are now out of date and are here:

http://www.energy.eu/#domestic

Since then the Euro has risen considerably against Sterling so in the comparison table it will make UK energy appear even cheaper.

* French price structure for electricity is much different to ours and if you heat with electricity you can choose a tariff(for a fee) for their equivalent of Economy 7 that gives very cheap night rates.

My understanding is that UK gas and electricity prices are cheaper than much of Europe.

So perhaps you have some figures to support this statement?(and include gas prices)

Across most of Europe, electricity is much cheaper than in Britain. In France, it is a fraction of the cost we pay here

1carminestocky

Alcohol - the enemy of accurate posting..hic!

mech_2

People seem to be cherry-picking prices at particular dates and trying to apply that to periods of months at a time without any real attempt to see past trends. First we will start with the wholesale prices. Here is a graph going back to 2000 showing oil in pounds per barrel on the same graph as month-ahead gas.



I have also plotted the difference between the two indexes as the green line. As you can see: in summer the gas and oil lines converge. In winter the gas price in p/therm tends to be double that of the oil price in pounds per barrel. And that is exactly what is happening now. Past exceptions have been years when gas was trading cheaply all year (2002, 2007) and a larger peak in winter 2005 when there was a panic over winter supply.

But this doesn't tell the whole story because we know the utility companies hedge their gas supplies in advance. Only a relatively minor proportion would be at these month-ahead prices. The prices for gas delivered more than a month ahead are usually higher and peak earlier than the month ahead price, and this also delays the effect of changes in oil price on the price at the household meter. So what we really need is a graph which tries to estimate what the gas companies are paying for the gas which we are burning right now given that they set the price anything up to 6 months ago. We don't know what ratio of gas is bought at what amount of time ahead, but we can guess and see what range of prices we come up with. So that's what I have attempted here:



I have left the oil spot price on there, though it really isn't useful any more. I have also added a curve I came up with some time ago which tries to estimate the wholesale gas cost that would relate to typical retail prices, though 20p/unit is a very low allowance for fixed costs really (and I think I forgot to take off the VAT too).

This graph shows that the price at the meter doesn't actually vary that much for any reasonable spread of prices (the blue line is probably the ratio that is most realistic). And it seems as though wholesale costs haven't yet peaked, so no chance of price reductions yet. The vertical red line is today. The price will peak some time in late December by the looks of things. It isn't clear how far it will then have to drop before the utility companies can estimate what their costs will be for the next x months. I suspect they will want to see what the oil price bottoms out at.

Note also that this graph still can't tell the whole story because it doesn't take into account the increased consumption in winter. Retail prices are likely to be more influenced by winter prices than summer prices.