He says that motorists are paying the price for mounting oil prices, and his friend at number 10 has said non-tax factors were mainly driving the cost at the pump. The comments were in response to OPEC chairman Abdullah al-Badri who had told motorists to blame their governments if they thought they were paying too much for the fuel in their cars.
It is virtually the same message as King Abdullah gave to Gordon Brown, when at a conference a few years ago, Brown hit out at OPEC, which seems to be largely controlled by Saudi Arabia, asking them to control the price of oil by increasing production, and promising to increase production in Scotland. The king pointed out, whilst looking straight at Gordo, that the price of oil was, in fact, quite reasonable, but that some governments chose to tax it more highly than others, thus causing greater strain to their citizens.
Prices of petrol have hit record levels at the pumps this week in Britain, despite falling in other European countries, including France and Germany.
So why’s that then George, if it’s all down to the oil producers?
Number 10 said that if the oil price goes up then that’s clearly going to affect the prices at the pump. Jeez, now we know why these people got to where they are.
But with petrol in the UK the second most expensive in the world and over 60% of that 2nd most expensive in the world fuel is tax, which has increased twice in the last two months, it’s a little disingenuous, to say the least, to blame the oil producers.
Pics: Our George: Have you ever wondered how much he understand of all this economics malarkey; Opec controls 40% of oil production; King Abdullah with some funny old bloke in a weird outfit inspecting troops; Breakdown of petrol prices based on 126.9p per litre.
According to the AA, petrol prices are unlikely ever to go below £1.10 a litre in Scotland again, even though costs are on their way down and we are an oil rich nation. The reason is a combination of increasing fuel duty from London, and Opec’s measures to keep oil prices reasonable high, usually by restricting its supply. The organisation argues that we will never see prices fall below £1.
History shows that petrol in this country has, allowing for inflation, kept normally within a fairly narrow band price wise. But today, at an average price of around £1.20 a litre, the cost is about 40% higher than the long-term trend.
There have been two periods in the past 108 years when prices have been so high. In the mid to late 50s, shortly after a post-war period of petrol rationing ended, they were as high as today. And during the First War they were the equivalent of about £1.90 litre. Of course as only the aristocracy could afford cars at that time, it wasn’t a huge issue for the likes of you and me.
Since the end of the 90s, crude oil has doubled in price, making this the main cause for fuel increases for the past decade. However, ten years ago, a government report found that, between 1990 and 1999, the price of North Sea oil fell 30%, yet fuel prices rose about 30%, and this was partly attributed to taxation. Today, 75p of the £1.20 that we pay for unleaded goes to the London exchequer.
So it's a combination of both plus greed of the oil producers that has caused our rapidly growing prices. This year we've had all of these. On 1 January 1 VAT went back up to 17.5%, which added a couple of pence to the cost of petrol. An increase to fuel duty and a scrapped subsidy has added about 2p extra from the beginning of April (with more due to come later in the year). Plus, according to the AA, wholesale prices went up 17% this year so far, which has put another 5p on top.
Petrol here is probably the most expensive in the world. I wonder if anyone reading this has noticed any country where it costs more...
As we couldn’t let a whole week go by without a wee bit of Petula, I thought that it might be an idea to look at how much petrol cost back in the late 70s.... well in this ad for a Chrysler Sunbeam, it’s 30p a gallon... about 7p a litre......
Oh happy days....
...........
PS: Pic for Brownlie (nice legs, huh?). Promise I'll do Peggy Lee soon!
It’s nothing to do with me, says George Osborne, referring to the price of petrol which is at record levels in the UK.
ncluding France and Germany.
