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Fuel pricing - time to take that tough decision?

As someone who worked in Oil & Gas, a few years ago when Queen Nicola was trying to make her first power grab the price of a barrel of oil was around 135 dollars for a short period of time & she was banging on about Scotland becoming the richest nation, streets paved with gold etc. I think petrol was around £1/litre. Over the years oil has hit an all time low, about 20 dollars & even some American oil companies were actually paying to get rid of it as there was no storage facilities left. The price at the pumps remained pretty stable. It certainly did not fall to reflect the price of oil. Today its 115dollars so why is the pump price rocketing. America does not need to import it any more due to fracking so there is loads of it swilling around. Mushroom syndrome, (Keep them in the dark & feed them s##t) & profiteering.
 
As someone who worked in Oil & Gas, a few years ago when Queen Nicola was trying to make her first power grab the price of a barrel of oil was around 135 dollars for a short period of time & she was banging on about Scotland becoming the richest nation, streets paved with gold etc. I think petrol was around £1/litre. Over the years oil has hit an all time low, about 20 dollars & even some American oil companies were actually paying to get rid of it as there was no storage facilities left. The price at the pumps remained pretty stable. It certainly did not fall to reflect the price of oil. Today its 115dollars so why is the pump price rocketing. America does not need to import it any more due to fracking so there is loads of it swilling around. Mushroom syndrome, (Keep them in the dark & feed them s##t) & profiteering.

Your assumption is based around that the only thing that dictates the price of a litre of petrol or diesel is the price of a barrel of oil. This is not the case.

Taxes, processing costs, transportation costs, profit margin. This is a small handful of stuff which also dictates the price on the forecourt. So while the price per barrel of oil might be the same as then, these other costs (and doubtless others I have missed) are not.
 
Your assumption is based around that the only thing that dictates the price of a litre of petrol or diesel is the price of a barrel of oil. This is not the case.

Taxes, processing costs, transportation costs, profit margin. This is a small handful of stuff which also dictates the price on the forecourt. So while the price per barrel of oil might be the same as then, these other costs (and doubtless others I have missed) are not.

Correct. Even the cost of refined road fuel ready to sell currently accounts for well under half the retail price at the pump.


Interesting to note that's based on a retail margin (to cover forecourt operating costs and profit) of just 2.29p per litre on unleaded and -6.37p on diesel!
 
Interesting thoughts. I can't really avoid driving, but have taken my Skoda (currently the most efficient car I own) on a few longer journeys to see what cost saving there might be. I found little difference in mpg between it and my E63 on long journeys, according to trip computers. And I know the Skoda mpg over estimates mpg compared with the E63.
Reducing the weight of my right foot would increase the difference, but for now it was reassuring that the E63 isn't actually costing me much more on fuel on those long trips 😁
On long trips I get more mog from long wheel base mb than Honda.
As someone who worked in Oil & Gas, a few years ago when Queen Nicola was trying to make her first power grab the price of a barrel of oil was around 135 dollars for a short period of time & she was banging on about Scotland becoming the richest nation, streets paved with gold etc. I think petrol was around £1/litre. Over the years oil has hit an all time low, about 20 dollars & even some American oil companies were actually paying to get rid of it as there was no storage facilities left. The price at the pumps remained pretty stable. It certainly did not fall to reflect the price of oil. Today its 115dollars so why is the pump price rocketing. America does not need to import it any more due to fracking so there is loads of it swilling around. Mushroom syndrome, (Keep them in the dark & feed them s##t) & profiteering.
Excellent sir. This sums it up.
 
Your assumption is based around that the only thing that dictates the price of a litre of petrol or diesel is the price of a barrel of oil. This is not the case.

Taxes, processing costs, transportation costs, profit margin. This is a small handful of stuff which also dictates the price on the forecourt. So while the price per barrel of oil might be the same as then, these other costs (and doubtless others I have missed) are not.
Taxes for import and later after refinement vat is added.
 
Its not true....my friend owns the garage near my work.....he recons its about 10p per litre on derv and 12p on petrol.....still need to sell a lot of fuel to make a profit after everything though. They might be including non fuel related expenses in those figure quoted above.
 
Its not true....my friend owns the garage near my work.....he recons its about 10p per litre on derv and 12p on petrol.....still need to sell a lot of fuel to make a profit after everything though. They might be including non fuel related expenses in those figure quoted above.

The RAC Foundation figures will be national averages ... there would certainly be local variations.
 
You think the RAC Foundation are making it up?
What filling station would sell a product at a loss of -6,37p/litre on diesel. If they are only making 2.29p/litre on petrol, it means their fuel sales are running at a loss of 4.08p/litre. That is assuming they are selling the same quantity of each fuel. May be wrong but I would imagine they are probably selling more diesel than petrol. They are not all owned by supermarkets using them as a loss leader. Need to sell a lot of flowers, sweets, newspapers to turn a profit
 
What filling station would sell a product at a loss of -6,37p/litre on diesel. If they are only making 2.29p/litre on petrol, it means their fuel sales are running at a loss of 4.08p/litre. That is assuming they are selling the same quantity of each fuel. May be wrong but I would imagine they are probably selling more diesel than petrol. They are not all owned by supermarkets using them as a loss leader. Need to sell a lot of flowers, sweets, newspapers to turn a profit

All forecourts rely on their shop/car wash/ etc. to make a profit. How many do you know of that ONLY sell fuel (even at supermarkets)?
 
I actually mentioned they have shops. Where I stay Asda has a fully automated filling station, no shop, no staff & its far enough away that you don't go near the supermarket.
Depends on what you read & this was 3 months ago

I guess if you have a fully automated filling station (I didn't think this was allowed from a safety POV?) then you have no staff costs and can afford a lower margin.

The bottom line is that the price of crude is a very small part of the forecourt price for pump fuel. Retailers buy refined fuels ready to sell, on the open market. Price is set by supply and demand.

The number of forecourts in the UK has been dropping steadily for years (decades) ... IIRC something like 40% have closed in the last 20 years. This wouldn't be happening if they were making a killing.
 
I would suspect most fuel stations are supermarket ones of some sort, so it would not surprise me in the least that they operate at a negative margin in order to attract customers.

The independent stations probably operate at a very slight positive margin.

The average of the above makes a slightly negative margin very believable.

I would also suspect the margin on "super" unleaded or diesel equivalent are also at a slightly more positive margin (but again, super is largely sold in much lower quantities).

It's worth remembering the forecourt is only a tiny sliver of the process. All the bits that happen between it and the oil in the ground is likely where most of the money ends up.
 
All forecourts rely on their shop/car wash/ etc. to make a profit. How many do you know of that ONLY sell fuel (even at supermarkets)?
When I had a filling station back in the early/mid 70’s we had 7d profit in a gallon of Petrol. No diesel as you could only get it at truck stops and the bigger filling stations. We used to have to keep a very close eye on what other stations were doing so we could try and maintain our customer base and not lose out because we were maybe a penny dearer. People were very sensitive about fuel prices even then just like they are now :rolleyes:
 
I've just been out after recovering from COVID and standard diesel is now £1.60, I'm sure it was £1.51 before I had to self-isolate!
 
When I had a filling station back in the early/mid 70’s we had 7d profit in a gallon of Petrol. No diesel as you could only get it at truck stops and the bigger filling stations. We used to have to keep a very close eye on what other stations were doing so we could try and maintain our customer base and not lose out because we were maybe a penny dearer. People were very sensitive about fuel prices even then just like they are now :rolleyes:
1200 USD plus taxes for an iPhone pro, and people complaint about 10p hike?
 
Totally agree with this. Us Brits take tend take it on the chin when we get our pants pulled down.
Do we? European prices seem higher, apart from Spain and the Eastern European states.

Which EU countries do you think are cheaper?

France and Italy certainly aren’t cheaper. And, in general, Brits enjoy greater access to Supermarket petrol than is common across the EU.

If anything UK petrol prices seem to be subsidised by overpriced grocery stores and witless purchases of “snacks” and drinks
 
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