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Profiteering oil companies?

Community Veteran
Posts: 7,149
Thanks: 51
Fixes: 2
Registered: 30-08-2007

Profiteering oil companies?

At the merest hint that the OPEC members are considering a price rise for a barrel of crude, oil companies supplying fuel to petrol and diesel pumps, can within minutes apply a price rise to you and me, in spite that it is well known that a price rise in crude can take several weeks to effect that moment of production at the pumps from stock levels held at refinery's. Why then does it take so long for the same oil companies to re-calculate a price reduction when the price of crude falls.
Some retail garages -notably supermarket chains- are at this time slightly reducing their prices, but nothing like the percentage that the actual cost per barrel has fallen over recent months.
Has anyone heard of an oil company actually successfully defend this position, in terms that the hapless consumer can understand.
Experience; is something you gain, just after you needed it most.

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21 REPLIES
Superuser
Superuser
Posts: 2,518
Thanks: 219
Fixes: 5
Registered: 06-04-2007

Re: Profiteering oil companies?

Our 2 closest Tesco petrol station is always 2p a litre behind those around them, and the price changes they change at the same time.  They are about 4-5 miles apart and one of them is always a few p cheaper than the other, but as I say always 2p cheaper than the next cheapest in the area.
It looks to me like it is more to do with Tesco being the cheapest that the actual price of oil.
Phil
pierre_pierre
Grafter
Posts: 19,757
Registered: 30-07-2007

Re: Profiteering oil companies?

in my part of Essex, Braintree, Chelmsford, Colchester, Shell, Sainsbury are 1p cheaper than Tesco, only reason I use Tesco at the moment is a 5p a litre off voucher
see also http://www.keepmoving.co.uk/fuel_info.aspx and http://www.petrolprices.com/ for uptodate price comparisons
James
Grafter
Posts: 21,036
Registered: 04-04-2007

Re: Profiteering oil companies?

I can't remember the actual deal, but I think Sainsbury's do something promotional if you pay £50 or more when you shop there.
pierre_pierre
Grafter
Posts: 19,757
Registered: 30-07-2007

Re: Profiteering oil companies?

they did last month Lips are sealed
N/A

Re: Profiteering oil companies?

Retailers can only drive prices down if others are prepared to compete.
If other outlets can charge more for the same product and sell it in sufficient quantity to make enough profit they have no incentive to reduce their pricing.
It they don't reduce theirs, the cheaper retailer is happy to maximise their profit whilst remaining cheaper than their competitors - good for marketing, business and the moral advantage too.
If everybody started to buy their fuel at the cheapest outlet, the competition would force the price down.
While folks remain happy to pay a few pence a litre more, nothing will change.
Fortunately in Leeds/Bradford people tend to be more tight-fisted, and do buy their petrol at the cheapest place, which is why this is one of the cheaper parts of the country for buying petrol. (111.1avg here, versus 112.1avg in Sheffield.)
If it works around here, why don't folks in other parts of the country do the same?
Superuser
Superuser
Posts: 2,518
Thanks: 219
Fixes: 5
Registered: 06-04-2007

Re: Profiteering oil companies?

Hmmm.  We're currently on 108.9 - 110.9 a litre in  Liverpool.  Does that mean we're more tight fisted than you!?!  Undecided
Phil
N/A

Re: Profiteering oil companies?

Yup, gonna move over there I reckon!
Although I was using www.petrolprices.com as my source, and that shows Liverpool as being 111.6p on average.
Is yours from driving round, or from a different website?
Superuser
Superuser
Posts: 2,518
Thanks: 219
Fixes: 5
Registered: 06-04-2007

Re: Profiteering oil companies?

Really we're not quite Liverpool.  I'm 17 miles from the city centre.  The price's I quoted are from driving around, but from PetrolPrices.com we've got Shell Maghull and Shell Fazakerley both at 108.9.  From there there is also Tesco Leyland Extra which is 107.9.
Phil
nadger
Rising Star
Posts: 4,498
Thanks: 46
Registered: 13-04-2007

Re: Profiteering oil companies?

Our local Tesco was 112.9 yesterday - nearby Shell station was 111.9.
Only use Tesco to get points as they are quadrupled for Eurotunnel vouchers ( yes I know) so get about 4.5p off per litre.
Moderator
Moderator
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Registered: 14-04-2007

Re: Profiteering oil companies?

Tesco are currently giving a 5p/litre off token if you spend £50 or more in store. I have one in my wallet for this weekend.
I'll probably have about 2.5% knocked off my exorbitant petrol bill as a reward for spending in excess of £50 on groceries and stuff Crazy
Customer and Forum Moderator.
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pierre_pierre
Grafter
Posts: 19,757
Registered: 30-07-2007

Re: Profiteering oil companies?

I thought 5 off 111.9 was a bit more than 2.5% Embarrassed
nadger
Rising Star
Posts: 4,498
Thanks: 46
Registered: 13-04-2007

Re: Profiteering oil companies?

Quote from: pierre_pierre
I thought 5 off 111.9 was a bit more than 2.5% Embarrassed
4.468% based on 5/111.9x100
pierre_pierre
Grafter
Posts: 19,757
Registered: 30-07-2007

Re: Profiteering oil companies?

thats roughly what I meant
Denzil
Grafter
Posts: 1,733
Registered: 31-07-2007

Re: Profiteering oil companies?

Round here (west Cornwall) the cheapest diesel has been stuck at £1.21 for the last couple of weeks, despite that fact that crude prices have fallen about 10% in the last month.
Compare with <a href="http://news.bbc.co.uk/1/hi/business/7610062.stm">this story</a>.