sinclair89:
Just drove past my local petrol station.
Unleaded -104.9p
Diesel - 111.9pAny one think it will go under a pound?
Let’s hope so 
Lowest I have seen so far was/is 105.9 at the new one on the bypass round Oakham.
Wheelnutt said "25-30% per litre is the actual cost of the oil. A drop of 50% in the price of oil will only drop a litre of diesel by 15p. The current price at the pumps reflect pretty accurately what the wholesale cost of Gasoline, a barrel of WTI or Brent is.
We may see another drop of 8-10p at the pumps once oil hits 20 bucks a barrel. The harder oil drops the smaller the resultant price change will be at the pump, it isn’t linear, no matter what your charts say.
Oil can drop to a dollar per barrel, price will only go down to 90p or there abouts."
Sure the process is linear for petrol to oil prices. If it were not, then prices would be anything made up regardless of the underlying market - as is the case with natural gas costs to the home consumer. (static) compared to the wholesale price (already collapsed)
In 2008 when Oil plunged from $147 to $34 - the forecourts got it down to 82.9p from 119.9p on that occasion, which even then seemed overpriced for an oil price that had fallen 75%.
Just how many hikes in fuel duty HAVE there been since 2008?
I thought the fuel duty escalator had been “flattening out” these past recent years?
Besides, if we’re comparing the pump price to the wholesale GASOLINE price rather than the Crude price - the ONLY difference that can be added to the margin - has to be “transportation and taxes”.
As the fuel price falls - the transportation costs fall with it. If taxes remain static, then in theory - every point off the price should and needs to be reflected at the retail end, since they are getting cheaper deliveries, and a cheaper commodity - regardless of how much of the same taxes they might pay per litre.
Your comment regarding 50% off crude=15% off petrol - is pretty accurate though. It fits in fine with the roughly 75% drop in crude in 2008 only representing almost exactly the 30% you speak of (halved, and halved again) on that occasion.
Anyone suggesting that “petrol cannot go below 100p unless crude falls below $20” though - this doesn’t make sense, and it didn’t stay above 100p in 2008 either.
As the distillate glut grows - it then becomes more expensive to “hoard” fuel rather than just flog it off for even an ever-lower price.
As the Transport industry has storage as well as movement orders - it’s therefore possible that they won’t benefit as much from the lowering fuel prices for the STORAGE reasons, rather than the price pass-on not being linear. 
If we make a graph based on the fall so far, and further falls projected and their effect on the forecourt price… 50% off oil = 15% off petrol…
$50 oil represents 106p per litre (right now)
$25 oil represents 90p per litre
$12 oil represents 76p per litre
$6 oil represents 64p per litre.
Based of course on a STATIC UK taxation of fuel.
Since Oil was trading around $12 for a while in the 90’s - there’s a historical precendent for it perhaps to return to this particular level.
I don’t think $6 is realistic though, as oil wells will be getting mothballed by the thousand all over the world - by this point, which will deny the price getting this low respectively.
Winseer:
Just how many hikes in fuel duty HAVE there been since 2008?
I thought the fuel duty escalator had been “flattening out” these past recent years?
The Fuel “escalator” was abolished and has been replaced with the Fuel “stabiliser”, in the UK the tax on the production of oil has increased by 12pc, the current government abolished the escalator when a barrel was over 120USD, the stabiliser is now actually increasing the proportionate taxation per litre at the pump, it currently stands at 78pence, so percentage wise a litre of fuel is now taxed heavier then when the escalator was still in force in 2008, hence my comment earlier that fuel taxation is not linear when looked at it over time.
Winseer, your argument doesn’t wash, it would hold up if all else was still equal, however taxation has moved on.
Fuel cannot drop a whole lot below a quid per litre under the current taxation regime, it would have if the old escalator was still in effect.
Your argument would be valid in '08, it isn’t now. WTI can drop to a tenner a barrel, we would still pay just under a quid at the pump. Even if the Saudis gave it away for free, we in the UK would probably still get charged 96-98p per litre.
Just paid for last months heating oil and got a price for this month, it has dropped 8ppl in a month.
Thinking of filling up our Cherry tank for the coming season, anyone care to predict when prices are likely to bottom out?
chicane:
Just paid for last months heating oil and got a price for this month, it has dropped 8ppl in a month.Thinking of filling up our Cherry tank for the coming season, anyone care to predict when prices are likely to bottom out?
If anybody knew exactly where it would bottom out, they would sell the house, the wife and the kids, leverage the living daylights out of it and retire in one trade.
We havent hit bottom yet, nobody is blinking, the Saudis, Russians, Venezuelans, none of them are talking a reduction in production, nobody wants to blink first. The big oil traders and companies are renting ultra large tankers for storage and parking millions of barrels at a time at sea. Everybody is waiting for the bottom, once a single producer cuts production all will run for the exit, until that happens we will keep dropping, 20 dollars a barrel is in sight unless production drops. We keep reducing the demand side all over the world and have a huge over supply right now.
One other thing to keep an eye out for is the rig count in the US, it has been steadily dropping since the high last summer, once that rig count stops reducing we could finally see a reduction on the supply side that matches the demand side. There is a huge imbalance, keep an eye for that to zero and we are getting close to the bottom. Oil price is still dropping faster than the supply side so there is room for further downside.
The Saudis have the cheapest production cost of any of the large producers, they will happily keep the price low while they are still making a profit, for a year to drive other producers out of production, they will then drive the price up and their market share will blossom once again. It is the Shale producers in the US and the Sand producers in Canada that are over supplying the market, their cost is a lot higher, so once they are gone, the Saudis will let the price go back up. The Saudis are playing this brilliantly, using true capitalism against the producers in North America. All the big fans of home grown production in the US didn’t see this one coming.
On a side note, the price is actually hurting a lot of the transport companies such as shipping and airlines in the West, they were hedging their fuel cost when we were paying over a hundred a barrel, the ME never did, they just pump it out of the ground at a fixed price, so now the Western transport companies are hurting while the ones in oil producing areas, except the US and Canada, because of their costs, are laughing all the way to the bank.
WTI just dropped below $48 a barrel for the first time since April 2009.
SO… If I understand this correctly - Fuel Duty is a fixed 76p now rather than a percentage, and my 2008 calculations are way off base, due to being out-of-date with my formula.
That would mean that if Oil was absolutely free per barrel, the price at the pump would be … 76p per litre, because it’s a base price of p plus the fixed tax of 76p.
At which point do you think the revolution would overthrow our current tax regime doya think?
Wouldn’t it still be linear in that the current price of $46 all the way down to the “free” level - would merely have the remaining points of movement of 105p to 76p spread between the remaining dollars of drop available?
This would mean about another penny off at the forecourts for each $1.50 further off the current barrel price in that case… 
There would in reality be a number of forecourts going bust on the way - since the transportation and storage costs are not factored into a pump price that has a lower and lower number of pence profit for the retailing fuel industry as the price per barrel continues to fall.
Since Oil has been “low before” - The obvious thing for the government to do would be to bring back the older system of taxation that can thus avert this crisis point that looks like occuring this side of Easter otherwise. 
Unleaded has fallen another 6c per gallon so far this week, and Crude another couple of bucks. Not bad seeing as we’re only just into Tuesday as I write this…
…Don’t forget to lobby your MP to get the Gas companies to DROP THEIR DAMNED PRICES seeing as we’ve had none of the falls passed on to date…
At least the Oil firms have passed on a fair amount of the drop so far… 
Winseer:
That would mean that if Oil was absolutely free per barrel, the price at the pump would be … 76p per litre, because it’s a base price of p plus the fixed tax of 76p.
Sure if the Saudis would transport it for free to the UK, the transfer guys would pipe it for free to the refineries, the refineries would distill it for free, the tankers would transport it to the forecourt for free, the retailers would sell it at no mark up, the insurance companies along the way would not charge anything to insure all that movement and refining, the ships and the tankers would get their fuel for free, all the guys working downstream would do it for charity and be willing to work unpaid.
Yup I can see all that working swimmingly…
Oil is cheap enough now that any further drop would really not do anything at the pumps, as I have stated before and will state again if you think that the price will drop much below a quid, you are living in fairyland, I don’t care what your charts say about the wholesale price of gasoline on the CME, that doesn’t translate to good old Blighty.
WTI down to $44 a barrel today, slight rebound now.
After a fair while of sides prices - Petrol, Crude, and Diesel especially - are on the wane again.
Ready for the forecourt prices to stab below £1/litre at long last?
Watch this space…
But will the energy suppliers cut their gas/electric prices , they have been shafting us all for decades and no one has done anything constructive to stop their price fixing , and always increasing their prices quicker than they lower them, sometimes not lowering them ?
tommy t:
But will the energy suppliers cut their gas/electric prices ?
No they won’t, they are businesses!
Pimpdaddy:
tommy t:
But will the energy suppliers cut their gas/electric prices ?No they won’t, they are businesses!
Hell will freeze over quicker 
Pimpdaddy:
tommy t:
But will the energy suppliers cut their gas/electric prices ?No they won’t, they are businesses!
they are ■■■■ takers more like, greedy barstewards that never pass on price decreases but always pass on increases, and they fix prices amongst theirselves , because of the lily livered ofgem, ,lol
No, what they’ll do is cut fuel to 99.9p in the next week - and brag that “We’re in a cut-price war among the supermarkets - aren’t we nice?” 
Finally, Oil has fallen below $30 on both Texan and North sea measures of it’s price.
A few weeks ago, Brent Crude was running at a $6 premium over WTI. Now the premium has all but disappeared out of the price, meaning in theory that we should by this point be selling it easier than the Americans.
Meanwhile, the Unleaded price has nearly HALVED again in the last year… Now reaching down to 21st Century lows…
Price at the pumps should be 92.9p by this point… But as per usual, they lag - and finally pretend they are in the so-called “cut price war among supermarkets only” when it eventually does shift down a few pence…
Decisions, decisions, somehow we’ve ended up in enough credit with our fuel supplier to more than fill the ‘cherry’ tank, problem is last thing I want is a load of winter diesel complete with bio-bollox turning to sludge and clogging up the filters. Our agri work won’t really kick off until April so holding off for now.
Was 99p in tesco yesterday.
What will happen if the price drops much more?
Will the government need to drop the tax?
Surely there won’t be hardly any profit.
By the time u take transport costs and so on into factor.
Been on news big pay offs in North Sea.
Themoocher:
Was 99p in tesco yesterday.What will happen if the price drops much more?
Will the government need to drop the tax?
Surely there won’t be hardly any profit.
By the time u take transport costs and so on into factor.
Been on news big pay offs in North Sea.
Government reduce the tax? You’re havin’ a 'augh!
Osbourne’s “Cut and save the economy” is well and truly knackered now by the loss of the fuel revenues.
He’ll just have to consider shafting over his rich friends who’ve quietly got away with the inland revenue no longer chasing the money abroad… Those departments are the ones facing the biggest cuts in the HMRC.
No wonder he was ■■■■■■■■ himself over the new year with fears that “Maybe the economy isn’t in such good shape as I suggested in the Autumn statement after all…”
Yeh right. You need to tax those with the money at all times - taxing a wasting asset is, and will always be the dumbest kind of tax ever.
99.9 for Unleaded, 99.7 for Diesel around here. For some reason the discount forecourts have given up trying to undercut. A few weeks ago they were going 102.9 with most forecourts going 106.9 at that time.
Now they go 101.9 with the supermarkets going the 99.9 in many places now.
Diesel is 97.9p in Costco but obviously you need to be a member and they don’t accept cash it’s card only.