Road fuel not expensive

thescouselander

Petrol is very hgh at the moment but I reckon the price of oil is down to investor speculation and not supply issues. There is a fair amount of evidence suggesting the supply is actually quite a bit in excess of demand.

There is clearly an oil price bubble - hopefully it will burst before I have to declair myself bankrupt!

anewman

thescouselander wrote: »

Petrol is very hgh at the moment but I reckon the price of oil is down to investor speculation and not supply issues. There is a fair amount of evidence suggesting the supply is actually quite a bit in excess of demand.

There is clearly an oil price bubble - hopefully it will burst before I have to declair myself bankrupt!

I personally reckon the oil companies are doing everything in their powers to get as much money as possible out of the oil because it ain't going to last forever. They have also been helped by that lovely Mr Bush.

AdrianHi

anewman wrote: »

I personally reckon the oil companies are doing everything in their powers to get as much money as possible out of the oil because it ain't going to last forever. They have also been helped by that lovely Mr Bush.

A couple of thoughts on this point which support this view:
The investment advice e-mails I've been getting the last year or so talk a lot about investing in commodities at the moment, commodities such as oil.
BP have been investing 100's of millions in IT systems in London to run a trading division for oil and other energy commodities and futures. They do this to maximise profits as oil prices rise, as they surely know they will.
I believe, but not so sure, that Shell are at the same game.

Here's a good news story from a while back http://news.bbc.co.uk/1/hi/business/5296092.stm

molerat

One of my local garages is charging 99.9p for LRP and making more profit per litre than he gets from anything else. Why is it so cheap ? He says it is because no-one wants it so he can get it very cheaply from the suppliers. I think that proves the oil companies are profiteering as they are piling increases onto the products that they know we cannot reduce our usage of.

bargepole

According to some stats on the main part of this site, only 39% of the pump price is due to the oil company and forecourt retailer. The other 61% is accounted for by fuel duty and VAT, so for every 115p litre, the government is collecting 67p - more than half the price.

MarkyMarkD

There's a lot of stating the obvious on this thread.

Obviously VAT is proportionate to the price paid. But that doesn't affect the fact that it's because the underlying price is rising, not because of the VAT, that the cost of fuel has increased.

Yes, the Government has made more money in VAT because the price has risen. But it's not a signficant proportion of the increase (in fact, it's less than 15% of the increase).

MEMBER02's calculations is incorrect. Of the 30p increase in pump price, the VAT element is 4.5p.

The fact that the government is getting an extra 4.5p/litre is a good reason not to increase the duty by 5p/litre. But it doesn't make the price rise the goverment's fault.

anewman

MarkyMarkD wrote: »

The fact that the government is getting an extra 4.5p/litre is a good reason not to increase the duty by 5p/litre. But it doesn't make the price rise the goverment's fault.

The price increases make people feel the pinch, and even though increasing due to commodity cost, with over half of the cost being tax, the Government makes as good a target for blame as the oil industry.

I think some protests will happen soon and the Government will get the blame - of course their reply will be they have kindly cancelled a proposed 2p increase and price increases are due to a world-wide increase in oil costs. Plus they'll be using their anti-terror legislation to stop go-slow lorry protests etc :rolleyes:

They only cancelled the 2p increase as they knew there'd be protests.

jamie304

thescouselander wrote: »

Petrol is very hgh at the moment but I reckon the price of oil is down to investor speculation and not supply issues. There is a fair amount of evidence suggesting the supply is actually quite a bit in excess of demand.

There is clearly an oil price bubble - hopefully it will burst before I have to declair myself bankrupt!

I am afraid these prices are here to stay. On the futures market oil is $140 a barrel at 8 and 16 years in the future. So that means the market does not expect the price to ever come down.

Sure, some of the current price is speculation etc, but only about $20 of it. There will be small ups and downs but we will never see oil at $100 again, and that is down to long term supply issues - it really is starting to run out.

Pew_Pew_Pew_Lasers!

jamie304 wrote: »

Sure, some of the current price is speculation etc, but only about $20 of it.

http://www.marketoracle.co.uk/Article4793.html

tomstickland