No fall in petrol prices says industry

The Petrol forecourt industry in the UK has defended the price charged at the pumps saying that currency values mean that they can’t pass on the drop in oil prices.

The price of oil is calculated in dollars and sterling has recently dropped against the dollar, which means that although oil has fallen in price, those savings are reversed due to the currency valuations.

The petrol industry states that the price of petrol at the pumps is mainly dependant on other factors apart from the price of crude oil. They say that 60 per cent of the price paid at the pump is made up of fuel duty and VAT. A further ten per cent covers marketing, delivery costs and the profit margin of suppliers and retailers. Only 30 per cent of the price depends on the cost of oil.

Highest prices of petrol

Unleaded petrol is close to its highest ever price in the UK, averaging 136.58 pence a litre across UK forecourts. The record level, seen in May 2011, was an average of 137.43p per litre. Diesel prices have not increased as much, but they are still within three pence of their record levels.

Since April the 8th the price of Brent crude has fallen by 18 per cent but the cost of petrol has increased. The industry says that it only makes between two and four pence per litre, meaning that a full tank of petrol makes them a profit of between £1 and £2.

Fuel prices

(new records set – impact is biting)

from the AA

Three quarters of respondents are cutting back on spending and/or driving because of rising fuel prices.

Compared with 2007:

• 31% say they travel less by car
• 16% say they have cut back on other expenditure, and
• 29% say they have done both.

Apart from driving, the main area for saving is on entertainment – mainly trips to cinema and restaurants.

Panelists think that the government is most responsible for fuel price rises, followed by oil companies and oil producing countries.

While 12% blame city traders, only 1% blame individuals owning filling stations.

Over 80% think there should be a body charged with monitoring the market to ensure fair prices.

72% agree that fuel retailers may not pass on all of any reduction in fuel tax that a fuel duty stabiliser may bring.