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Oil prices

razilrazil
in Not Sports Related
Don't seem to have halfed at the pumps, yet price of crude has apparently fallen by nearly that much in six months, tax? Profiteering?

Anyway what is the cause, are US increases in production aimed at hurting Russia? And OPEC refusing to reduce demand
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Comments

  • Greenie JuniorGreenie Junior
    1.12 for unleaded at charlton asda
  • Kap10Kap10
    edited December 2014
    razil said:

    Don't seem to have halfed at the pumps, yet price of crude has apparently fallen by nearly that much in six months, tax? Profiteering?

    Anyway what is the cause, are US increases in production aimed at hurting Russia? And OPEC refusing to reduce demand

    Its a bit of all three, petrol is taxed quite highly. like cigarettes of which 80p in the £1 goes to the treasury, not sure of the petrol breakdown but it is similar. Drops at the pumps should still come through, but look out for the next government hiking up petrol again.

    Saudi are too committed to expenditure that they cannot reduce production, shale in US has moved US to virtual self sufficiency.

    Knock on effects are that oil exploration in Arctic and other new territories have been postponed as they are no longer commercially viable.
  • AFKABartramAFKABartram
    Price won't be halved as only a certain percentage of the price goes to the company setting the price
  • AFKABartramAFKABartram
    Duty and VAT account for something like 60% of the price doesn't it
  • Stu_of_KunmingStu_of_Kunming
    OPEC can't reduce production, far too worried about shale!
  • razilrazil
    58p per litre is duty, then theres VAT, so I assume the former remains the same regardless
  • RobRob
    In the States the price of petrol at the pumps has dropped about 25% in the past six months. The price of a barrel of crude oil over the same period has dropped about 35%. So, over here, the person on the street sees a fair amount of the reduction and it is still falling. In view of the drop over here I was going to ask the question myself the other day as to whether you in the UK are benefiting from the lower price of crude. Apparently not (not significantly anyway).

    The average price of a gallon of petrol in the States at the moment is $2.86. (the US gallon is smaller than the imperial gallon).
  • Stu_of_KunmingStu_of_Kunming
    Rob said:

    In the States the price of petrol at the pumps has dropped about 25% in the past six months. The price of a barrel of crude oil over the same period has dropped about 35%. So, over here, the person on the street sees a fair amount of the reduction and it is still falling. In view of the drop over here I was going to ask the question myself the other day as to whether you in the UK are benefiting from the lower price of crude. Apparently not (not significantly anyway).

    The average price of a gallon of petrol in the States at the moment is $2.86. (the US gallon is smaller than the imperial gallon).

    The difference is because the fixed cost of tax on petrol is much lower in the US, meaning a higher % of the cost is based on the price of oil. As we say some of the highest tax on petrol in the world the price drop will mean less here.

    The tax on petrol is a fixed amount, it's not a % of the price.
  • RobRob
    Agreed. It's all about the amount of taxation.
  • Athletico CharltonAthletico Charlton
    Saudi's scared of shale and also trying to damage Iranian economy.
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  • carly burncarly burn
    Have a heart !
    Think of the poor oil drillers
    , refiners and sellers won't you this Christmas;(
  • razilrazil
    Lots of Shale under Russia and Ukraine apparently
  • LargeAddickLargeAddick
    We have oil fired central heating. When we moved in under three years ago it was 67p a litre. Now it's about 45p. Long may it continue.
  • Exiled_AddickExiled_Addick
    edited December 2014
    Things could get interesting for the economy here in Oil County Alberta if the price stays low, but for now the short term effects are nice enough - paid the equivalent of about 45p a litre when I filled up last night, which is about half what I was paying in the UK when I started driving! I kind of wish I'd bought that V8 pickup truck now.
  • oohaahmortimeroohaahmortimer
    Someone with more of a clue than me will know
    Did I hear Scottish Independence , if it had come to fruition, would have been in massive trouble because a lot of their income was based on the price of oil being a lot higher than current levels ?
  • bucksheebuckshee
    Where's this then?

    image<img
  • IAIA
    #prayforScotland
  • Chaz HillChaz Hill
    Every 'silver lining' has 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!
  • Stu_of_KunmingStu_of_Kunming
    Chaz Hill said:

    Every 'silver lining' has 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    If the price of petrol is dropping, maybe more people will consider a drive into the country to be an affordable day out, meaning they use more petrol. As tax on petrol is a set figure per liter that would be an increase in revenue??
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  • Chaz HillChaz Hill
    Chaz Hill said:

    Every 'silver lining' has a 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    Stu_of_Kunming said:

    Chaz Hill said:

    Every 'silver lining' has 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    If the price of petrol is dropping, maybe more people will consider a drive into the country to be an affordable day out, meaning they use more petrol. As tax on petrol is a set figure per liter that would be an increase in revenue??
    True, especially with the festive season upon us but it will nowhere near compensate for the loss in the revenue from the day to day essential use purchases. I'm still not convinced it will be a long term reduction anyway but who knows with the world economies as they are!
  • Charlton_StuCharlton_Stu
    Asda have announced another 2p cut tomorrow, will be £1.10 for unleaded.
  • cabblescabbles
    In my first company the oil & gas division (I was at an events company who organise summits) had an Exploration & Production Summit back in 2006/07/08/09. The Exploration bit got dropped (In Europe anyway), it became on Offshore Production Summit, talking about the technology involved in Offshore Production. From my basic understanding of this area, it was getting harder and harder to identify and utilise technology to maximise oil production.

    I've no technical knowledge mind, but from the way the industry was talking, shale, LNG and renewables really are the way forward. Again, as @Kap10 mentions above some of these areas are so challenging to produce oil from. Based on this, and based on the fact that we have diminishing oil reserves, shouldn't the price of oil be going up, or am I being to over simplistic and a bit thick?
  • AddicktedAddickted
    If it drops below £1 a litre it won't be worthwhile me siphoning the neighbours Range Rover.
  • DippenhallDippenhall
    Oil is bought in $US so the £ currency exchange rate can have an impact on what we pay at the pump.
  • Stu_of_KunmingStu_of_Kunming
    Chaz Hill said:

    Chaz Hill said:

    Every 'silver lining' has a 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    Stu_of_Kunming said:

    Chaz Hill said:

    Every 'silver lining' has 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    If the price of petrol is dropping, maybe more people will consider a drive into the country to be an affordable day out, meaning they use more petrol. As tax on petrol is a set figure per liter that would be an increase in revenue??
    True, especially with the festive season upon us but it will nowhere near compensate for the loss in the revenue from the day to day essential use purchases. I'm still not convinced it will be a long term reduction anyway but who knows with the world economies as they are!
    What day to day purchases? Are we still talking about petrol?

    People are going to stop their essential purchases because fuel has dropped in price?
  • Chaz HillChaz Hill
    Stu_of_Kunming said:

    Chaz Hill said:

    Chaz Hill said:

    Every 'silver lining' has a 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    Stu_of_Kunming said:

    Chaz Hill said:

    Every 'silver lining' has 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    If the price of petrol is dropping, maybe more people will consider a drive into the country to be an affordable day out, meaning they use more petrol. As tax on petrol is a set figure per liter that would be an increase in revenue??
    True, especially with the festive season upon us but it will nowhere near compensate for the loss in the revenue from the day to day essential use purchases. I'm still not convinced it will be a long term reduction anyway but who knows with the world economies as they are!
    What day to day purchases? Are we still talking about petrol?

    People are going to stop their essential purchases because fuel has dropped in price?
    You pay VAT as part of the cost of fuel. Therefore the cheaper the fuel element the less revenue going to the Exchequer.
  • charltonkestoncharltonkeston
    Chaz Hill said:

    Stu_of_Kunming said:

    Chaz Hill said:

    Chaz Hill said:

    Every 'silver lining' has a 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    Stu_of_Kunming said:

    Chaz Hill said:

    Every 'silver lining' has 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    If the price of petrol is dropping, maybe more people will consider a drive into the country to be an affordable day out, meaning they use more petrol. As tax on petrol is a set figure per liter that would be an increase in revenue??
    True, especially with the festive season upon us but it will nowhere near compensate for the loss in the revenue from the day to day essential use purchases. I'm still not convinced it will be a long term reduction anyway but who knows with the world economies as they are!
    What day to day purchases? Are we still talking about petrol?

    People are going to stop their essential purchases because fuel has dropped in price?
    You pay VAT as part of the cost of fuel. Therefore the cheaper the fuel element the less revenue going to the Exchequer.
    You also pay duty on it that is fixed per litre.
  • Stu_of_KunmingStu_of_Kunming
    Chaz Hill said:

    Stu_of_Kunming said:

    Chaz Hill said:

    Chaz Hill said:

    Every 'silver lining' has a 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    Stu_of_Kunming said:

    Chaz Hill said:

    Every 'silver lining' has 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    If the price of petrol is dropping, maybe more people will consider a drive into the country to be an affordable day out, meaning they use more petrol. As tax on petrol is a set figure per liter that would be an increase in revenue??
    True, especially with the festive season upon us but it will nowhere near compensate for the loss in the revenue from the day to day essential use purchases. I'm still not convinced it will be a long term reduction anyway but who knows with the world economies as they are!
    What day to day purchases? Are we still talking about petrol?

    People are going to stop their essential purchases because fuel has dropped in price?
    You pay VAT as part of the cost of fuel. Therefore the cheaper the fuel element the less revenue going to the Exchequer.
    VAT makes up a tiny amount of the tax paid on fuel, surely?
  • Chaz HillChaz Hill
    Stu_of_Kunming said:

    Chaz Hill said:

    Stu_of_Kunming said:

    Chaz Hill said:

    Chaz Hill said:

    Every 'silver lining' has a 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    Stu_of_Kunming said:

    Chaz Hill said:

    Every 'silver lining' has 'cloud'. How is George going to make up for the lost revenue particularly as petrol taxes are the the easiest and speediest to collect!

    If the price of petrol is dropping, maybe more people will consider a drive into the country to be an affordable day out, meaning they use more petrol. As tax on petrol is a set figure per liter that would be an increase in revenue??
    True, especially with the festive season upon us but it will nowhere near compensate for the loss in the revenue from the day to day essential use purchases. I'm still not convinced it will be a long term reduction anyway but who knows with the world economies as they are!
    What day to day purchases? Are we still talking about petrol?

    People are going to stop their essential purchases because fuel has dropped in price?
    You pay VAT as part of the cost of fuel. Therefore the cheaper the fuel element the less revenue going to the Exchequer.
    VAT makes up a tiny amount of the tax paid on fuel, surely?
    It was in the range of 20-25p per litre pre the price crash. The Excise duty which remains the same whatever is about 60p. So the VAT drop will be a significant loss.
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