After weeks of prices at the pump falling and the government deferring the proposed August fuel duty increase, the world of oil is back to more familiar territory: squeezing the pockets of families and businesses by increasing prices of petrol and diesel.
In April petrol prices peaked at 142.48p a litre but then fell to 130.81p at the beginning of this month due to price crashes in the wholesale market.
Now, wholesale prices are on the rise again and petrol retailers are upping their prices quick as lightening to reflect this – if only they’d be that quick at passing on savings when prices crash! The AA says the recent crash in wholesale prices of petrol could have driven prices at the pump down by a further two pence per litre, but retailers didn’t pass the full savings on to consumers.
It’s normal for prices of petrol and diesel to fluctuate – this is because of the fundamentals of supply and demand which govern the price of most commodities. But according to the AA, current evidence suggests this latest rise is because of speculation in the oil and wholesale fuel markets.
A spokesman said: “A commodity speculator firm bought every cargo of premium unleaded offered for sale in north west Europe on one day.” This has artificially driven up the price of petrol and will allow market traders to make huge profits while consumers are left struggling.
This latest development comes just days after the results of a report for the G20 world leaders which suggested the oil market is open to “manipulation or distortion” by traders seeking personal financial gain.
We all knew the world of oil was a murky one, but in times of recession the government should be doing more to protect UK families and businesses that are the ones who suffer from this unscrupulous behaviour.
Like the Road Haulage Association’s Chief Executive, George Dunning, asks: “If we cannot trust those who set the price for the life-blood of our industry, what hope is there for the rest of the economy?”
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