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Why is petrol so expensive?


shark_90
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The media would have us believe that fuel is really cheap and that it's something to rejoice about. I keep hearing the constant BS and everyone is banging on about how good it is etc etc.

Well, no, it's not. Last time oil was at this level ($70) fuel was around the 82p/litre mark. So why is it a whole 17p/litre more?

And on top of that, why is diesel a whole 10-11p a litre more than that?!

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When it was last at $70 a barrel what was the tax hit, I bet it was lower than it is now. Add on that it might have been cheaper to move it around then for the cost of the people etc. and you get some way to the higher figure.

I agree though that they are still ripping us off but at least its going in the right direction.

On diesel, they don't have the capacity to refine it at a higher rate but demand has gone through the roof, and people are prepared to pay more because of the economy advantage and bingo higher price. :o:(

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:grin: I think I've posted this before but fuel is cheap - its just the tax that fecks us over.

The Shells of this world manage to find the oil, get it out of the ground, transport it around the world, refine it into petrol, get it to a petrol station all for about 35-40p a litre! The government then wacks about 50p fuel duty and then VAT on top to make us pay £1 something a litre :ffs:

Fuel Duty is also higher on diesel than unleaded too!

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I don't know for a fact but I believe the difference now to when the prices was the same before is the exchange rate. :(

yep; GBP:USD was about 1:2, it is now about 1:1.70 so 15% difference.

and quelle suprise; 97p is about 15% different to 82p so the actual USD price is about the same, but as GBP is worth less we pay more for the petrol;

Petrol is also priced in USD on the Rotterdam spot market.

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Anyone else noticed however....

The UK has the highest price for diesel anywhere in the EU - so the spin about refining is BS.

You can even see the price at every petrol station in France on a daily updated government website...

Bienvenue sur le site Internet du Ministre de l'conomie, de l'Industrie et de l'Emploi www.prix-carburants.gouv.fr

Why don't we have the same?? - Rip off Britain, again!

In my favourite petrol station - the following are being charged today

Diesel - 1.114€ per litre, Petrol 1.199€ per litre -

thats 90.4p per litre for diesel and 97.3p per litre for petrol at 1.2326€ to the pound.

AND THATS NOT THE CHEAPEST IN THE AREA - Just one of the most convenient to get to - the cheapest in the area and not too far to travel is 1.098€ (89.1p) for diesel and 1.181€ (95.8p) for petrol.

I might just start doing the few miles to the cheapest station after all - I'd save a whole 78p on a tank of diesel and a whopping 90p on a tank of petrol - and I'd see a bit more of France to boot!

Edited by pontyslapper
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Just going to run a quick comparison.

I'm going to compare prices around 20 miles radius to Portsmouth and the 20 miles radius to Caen. 2 ports linked by a daily service that I regularly use.

Exchange rate will be 1.233€ to £1 - as per BBC News website.

Cheapest in Portsmouth (Morrisons Horndean) - Unleaded - 97.9p (1.21€)

Cheapest in Caen (Leclerc) - Unleaded - 97.0p (1.194€)

Difference of .9p a litre - 45p difference on a 50 litre fill-up.

Cheapest in Portsmouth (Morrisons Horndean) - Diesel - 109.9p (1.36€)

Cheapest in Caen (Leclerc) - Diesel - 89.9p (1.109€)

Difference of 20p a litre - £10 difference on a 50 litre fill-up.

Now considering I normally take the old Mondey diesel estate and have to put a drop or two in in Portsmouth - just to get to my favourite station in France, I'll now be trying to eek out the dregs to make it last to the cheaper stations in France.

When you consider me and the car can do a 24hr run on the ferry for about 25-50 quid. A fill-up difference of this magnitude starts to make the rest of the trip even more attractive - what with the better prices on lots of 'normal' household stuff and not just the usual booze etc.

I won't be taking the Passat petrol estate anymore - no matter how much fun it is on the roads of France.

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GB realised we (as a nation) love our cars. He then makes sure any public transports systems hit the buffers, so we HAVE to use our cars.

Then he tax us to the hilt (and beyond) for the privilege.

He also cunningly realised that diesel was becoming really popular and his coffers would take a hit as we fill up less often. So he whacked the tax up on that as well.

Which was nice of him.

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GB realised we (as a nation) love our cars. He then makes sure any public transports systems hit the buffers, so we HAVE to use our cars.

Then he tax us to the hilt (and beyond) for the privilege.

He also cunningly realised that diesel was becoming really popular and his coffers would take a hit as we fill up less often. So he whacked the tax up on that as well.

Which was nice of him.

GB is acutally smarter then most of GB's citizens, even after all these yrs we have not found a replacement with an alternative policy!

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surely thats 3.05 dollars for a gallon?

i.e. roughly 40p/l

I think the US gallon is only 4 litres, as opposed to our 4.5 litres.

We pay about £4.50 a gallon at the mo, so $2.70 a UK gallon at an exchange rate of 1.7US $ per UK £.

Obviously does not take into account local US taxes and conditions.

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A couple of comments from me :

As stated elsewhere, the main culprit is tax/duty, not the retailers, however, when oil prices go up they are very quick to react, when they go down, they're much slower, making a few bob in the proccess.

Speaking of proccess, there is a genuine shortage of refinery capacity in the UK, taking LNG for example, the manufacturers recently GAVE IT AWAY FOR FREE to retailers as they had nowhere to store it. This doesn't affect the high-street price for petrol, but its a moot point for the oil companies / government.

Another point is the input of OPEC who like to manage supply/demand to their advantage. Russia are 'pig in the middle' and wade in when they can get a good deal. Their budget and economy is geared to oil being (IIRC) something like $70 a barrel, which is more than the current price, so they will restrict supply to force the price back up to balance their economy. This means prices will continue to drop in the very short term, then prob go up again, although not to the previous highs.

I believe Investors often look to Oil companies as short-term high-return investments, but I'm not smart enough to work out what effect the credit crunch is having on the investment market related to oil Co's, if I had more than 2p to my name I'd be investing in FMC technologies right now though :secret:

The price of petrol/diesel is irrelevant to 99% of TSNers in my opinion, there's feck all we can do about it (even with a change of government) as public transport is 3rd world quality in the UK, just fill up and enjoy driving while we're still allowed. :)

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TDK sums up my thoughts exactly with his last few sentences.

Even though my budget won't allow anything tastier than a 4 year old 2.0litre Passat at the mo. I'm damn well going to enjoy it as much as I can - even if that means nipping out in the depths of the night to gun the bejesus out of it up and down the local dual carriageway.

Of course, my real fun happens when we're in France on the back roads round by our little bolthole. Bugger all traffic and huge wide roads with some tight bends and some open sweepy stuff.

I can get between ours and our friends in as little as 3 minutes - what a drive that is - even in the Passat.

Like someone else has said, I'll regard petrol and diesel as cheap until it crosses into the land of double figures per litre.

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