Rags

not to sure on the impact it will have on you lot over there

but I can tell you that where I live petrol has gone up nearly 20cents a gallon in the past 2 1/2 weeks !! p*ss take!!!

Rags

kingofturds

iTrader: (1)

petrol works out at about $8.50 a gallon over here guv

Rags

Yeah i know mate, I only left England about a year ago. What i mean't was are you seeing the big rises over there like we are here?

All the Yanks are going nuts cos there big a** SUV's only do about 8-10 miles a gallon!

When i got here in October last year it was only $1.72 a gallon, today its $2.47

AndyC_772

iTrader: (2)

Right - proportionately speaking, it'll have much less effect on us than it will on the US.

If you want to compare prices, be sure to compare like for like - a US gallon is smaller than an Imperial gallon, and UK prices haven't been posted in gallons for some time now.

Round here, 95 RON unleaded is about 91 pence/litre and 97 RON super is more like 97p. (Note also that US octane numbers are measured differently to the figures quoted in the UK and come out lower for a fuel of simliar quality).

Rags

Cheers for the info Andy.

Does that mean that when crude price goes up the percentage increase in US petrol prices and US prices is alot different?

AndyC_772

iTrader: (2)

Yes - 80% or thereabouts of the cost of UK fuel is tax, on top of which there are the usual distribution and retail overheads, so the actual cost of the oil is a tiny percentage of the pump price. Frankly the price of a barrel of oil could double and we'd hardly notice.

imlach

Fuel duty is fixed at around 48p/litre. It is not a percentage, so any rise in petrol prices is purely down to the oil companies/crude cost, and nothing to do with fuel duty (aside from the wee bit of extra VAT).

Just FYI

sarasquares

iTrader: (1)

will i get moere dollars for the pound now

imlach

Yes, we're up to $1.79 today....

imlach

Just for correctness, ULSP fuel duty is 47.1p/litre, going up to 48.32p/litre on 1 September.

kammy

As much as it hurts me, I think high fuel costs is a good thing. Despite petrols huge inelasticness (is that even a word?) to price (how demand responds to price changes) we need to reduce our consumption or its going to run out very quickly, and high prices help.

Did my dissertaion on this topic, and am hoping to do it for my masters if I am accepted; so that will bring in some econometrics so i will keep you guys posted in the near future

Kam

Brit_in_Japan

The capacity to pump oil from the ground is at, or very close to, the maximum possible. After it's reached peak caacity there will be a long period of reducing oil production over the next 50 - 80 years. But the "price elasticity of demand" for oil is such that increases in price will have proportionately small effect in reducing demand from consumers as consumers have no alternatives they can easily adopt. Result: ever increasing fuel prices as people bid for their share of a decreasing resource. China alone now imports more fuel than any other country in the world except the US, and their fuel demands are still rapidly increasing.

In 5 years we will think it incredible that oil was ever as cheap as $65 a barrel!

Flatcapdriver

I beg to differ. In terms of reserves there is plenty of oil to go around but what is causing the problem is lack of refinery capacity (particularly in the US) and that coupled with the various speculative punts from hedge funds, not to mention high demand are the main factors keeping oil prices high. When additional refinery capacity comes on line around 2007 I expect prices to soften.

TelBoy

Flatcap - the primary reason for the recent price rise is the the risk of interruption of supplies now that King Fahd of Saudi Arabia has died (which yes, has led to speculative trading, not just by hedge funds). The path of future prices will depend heavily on how Western-friendly the successor is.

Flatcapdriver

Tel,
you're right of course but I was commenting on the increase in oil prices over the last twelve months as being *recent* not just the last few weeks. Any event seems to trigger an increase at the moment.

TelBoy

Ok, oh - i see.

I had to laugh when Iraq justified their resumption of nuclear activity by saying they wanted to "conserve oil and gas reserves". Goodness me, even *i* could have thought of something better than that...!!

Flatcapdriver

What conclusions did you reach? As far as I can tell, people will moan and groan about oil prices and talk about reducing their consumption but when it comes down to it they aren't prepared to do anything. As an example, LPG or mains gas can be used in IC engines and there are a number of electric vehicles out there but how many vehicles are converted - not many.

Brit_in_Japan

Hmmm, I was going to disagree with you, but some research has shown that the current bottleneck is probably refinery capacity.
Oil Refinery Capacity Crunch

This definitely adds to price volatility as every technical glitch which halts production seems to cause the markets to jump. But there seems to be several reasons why they are not building lots of new refineries right now

1) environmental legislation makes it expensive to build new plant
2) oil companies make bigger profits when the refineries are working close to or at 100% capacity (return on investment)
3) there is a production crunch coming soon, so why invest in expensive infrastructure which will not be used to capacity?

No new refineries.

Flatcapdriver

Your first point is paradoxical given that it is differing environmental legislation in each state of the US requiring oil companies to produce different fuel blends to satisfy each State's pollution laws. So, not only is it causing the initial problem it also fails to provide a solution due to other legislation regarding the siting of new plants. I bet the environmentalists see that as a win win solution.

There are several new refineries coming on line in 2007 such as BP's in Galveston (may be a different city) and another one in the US plus Azerbaijan which is why I think oil and gas prices will ease.

There again, I've been wrong before and I'll probably be wrong again.

Flatcapdriver

Forget my second point because I'm not sure that's correct. I read something in Platts last week and although there is definitely some new refineries coming on stream they may not be in the US, although there is some additional capacity being added from existing refineries.

moses

in dubai petrol is 25 pence a litre

were getting ripped aff

imlach

$66 and climbing