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Petrol Prices Fall, but are we Better Off?

Just under a month ago the Chancellor of the Exchequer, George Osborne, announced that there would be a freeze in fuel duty across the UK. Even though this sounded like good news at first, the fact of the matter is that fuel prices across the country are still extremely high and fuel tax makes up a substantial amount of this cost. Many groups said that it would have been better for the Chancellor to reduce the amount of fuel tax instead of just freeze it, however this is an extremely unlikely move for the Chancellor to make while the UK still has a large deficit.

However, even though the government failed to reduce fuel duty, reports have suggested that the cost of petrol is currently at a five year low. According to the AA, the average cost of a litre of petrol in mid-March was 129.46p, while a year ago it would have cost around 138.42p. Surprisingly, London is one of the cheapest areas in the UK to buy petrol, where a litre costs an average of 136.3p, while Scotland has the most expensive average petrol price at 137.3p per litre. Continue reading

BP and Shell accused of fixing petrol prices

A while back the Office of Fair Trading published a controversial report which said that the price of petrol in the UK was fair, and that oil companies are selling the product in accordance with market prices. The report went on to state that the only reason petrol is so expensive in the UK is due to the amount of fuel tax added on by the government, which led to widespread anger and eventually the Chancellor of the Exchequer George Osborne scrapping the 3p rise in fuel tax that was supposed to go ahead this September. Continue reading

Petrol prices increase across Europe

Due to the recession many people in the UK no longer have the funds to pay for a traditional holiday in the summer, which is why many now choose to drive to Europe in order to save money. However, it has been reported today that from now on this may not be as cheap as everyone had hoped, especially as a number of countries across Europe have recently increased their petrol prices. In a survey conducted by Post Office Travel Money, nearly half of all the eighteen countries that took part said that they have increased the amount they charge for petrol, meaning that holiday goers need to check before they leave so they don’t get a nasty surprise. Continue reading

Concerns over new environmentally friendly petrol

The government has been under pressure for the past few years to find new alternatives to petrol in order to reduce the amount of carbon dioxide emissions in the UK and attain its targets for sustainability required by the EU. Climate change has been a big concern for governments across the world for a long time now, however the fact that fossil fuels are also starting to run out also means that they are trying to find new ways to power vehicles before it becomes a problem.

Whilst electric and hybrid cars are already being manufactured by the car industry, they seem to be unpopular amongst the general public, especially as many are concerned that there are not enough re-charging stations throughout the UK so drivers could be limited to how far they could drive. This is why the government will soon be introducing a new alternative to petrol into forecourts across the country called E10, which will include ten per cent ethanol and produce lower emissions.

However, there have already been criticisms of the new fuel, as even though it produces less carbon dioxide emissions it also provides less miles per gallon, meaning that the average family would have to end up paying around eighty pounds more per year in order to run their cars. Furthermore, there have been concerns that the ethanol may be harmful for older cars and motorbikes as it could melt components in the engines. A study from the think-tank Chatham House said that: “The increased use of ethanol in petrol to meet EU sustainability targets is resulting in drivers paying extra at the pumps.”

A senior research fellow from Chatham House, author Rob Bailey, also said: “Based on case studies in other countries that have introduced E10, field trials and laboratory tests, the research found issues of material incompatibility, corrosion and drivability problems for vehicles of ten years or older. German motorists are also thought to be suspicious of the wider environmental and social impacts of ethanol.”

It is also unclear how car insurance quotes will alter after the introduction of the new fuel, especially if it could cause damage to cars. Furthermore, there may be an increase in drivers filling their cars with the wrong fuel when E10 is first introduced, meaning that breakdown cover suppliers may also have to increase their costs in order to deal with demand.

Oil Companies Not Worried About Electric Vehicles

The biggest oil companies in the world think that very few, if any, of today’s motorists will see electric vehicles outnumber gasoline and diesel vehicles in their lifetimes. While politicians and green groups throughout the world insist the future is electric, both BP and Exxon claim electric vehicles will only make up 5% of all vehicles globally in the next 30 years.

The oil companies’ forecasts may be self-serving but their research claims electric vehicles will not end our addiction to oil, and they have dismissed the major breakthrough in battery technology that may give electric vehicles a cost and performance edge over the internal combustion engine. The research published by Exxon and BP, Europe’s second-largest oil company, are the most detailed long-term forecast on electric vehicle take-up in the future.

The expected continued dominance of fossil fuels explains why BP and Shell have scaled back their solar, hydrogen and wind power ambitions and also Exxon’s reluctance to get involved in renewable energy at all. If the oil companies are wrong about electric vehicles they will find their huge investment in expensive oil production not paying off. A recent survey of auto industry executives gave an average forecast for electric vehicles to account for 10% of global auto sales by 2025, a better forecast than Exxon and BP but hardly a revolution. BP and Shell also predict that neither consumers, nor carmakers, will get over ‘range anxiety’ and they do not share the optimism of Renault and Nissan chief executives who have repeatedly said more and more motorists will be getting car insurance quotes for electric vehicles in the next decade.

Jos Dings, Director of a sustainable transport campaign group reacted with suspicion to the oil industry forecasts, he said: “They would say that, wouldn’t they. A big take-up of electric cars is not something they would like to see. The future for petrol and diesel doesn’t look good.”

Cut in supplies leads to fear of panic buying

Motorists in the South East of England are being urged not to panic buy fuel this week as a major oil refinery went into administration.

The Coryton refinery in Essex halted its supplies when news filtered through that its parent company based in Switzerland had collapsed and brought down the plant with it. The refinery provides approximately 20% of the fuel used by drivers in London and the South East and immediately there were fears that motorists, who are already paying out more for car insurance and fuel than at this time last year, would panic buy and send the price of diesel and petrol in the capital to a record high.

Charles Hendry, minister for energy and climate change, asked drivers to be sensible and just go about their normal business, saying “We don’t want everybody to go out and get it (fuel) tonight, because that clearly wouldn’t be helpful. People need to be completely confident that if they go about their business as normal then there is completely enough fuel available and that BP and Shell have been going to great lengths to make sure that is the case. There is the capacity in some of the other refineries in the UK. Companies like BP and Shell, who are the main buyers of the output from Coryton, have already made short-term arrangements to make sure that they get the fuel from other sources. We have spare import capacity so we can bring extra fuel in as necessary.”

However, garages were already reporting running out of supplies yesterday evening and there were queues at many forecourt early this morning as commuters set out on their journeys.

There are fears that closure of the plant could lead to the loss of 1,000 jobs, although administrators reported that the plant was still refining oil but not sending it out. They also confirmed they had already been contacted by interested parties and there was hope that the business would be saved.

Fairfuel campaign hits the mark

After months of campaigning across the length and breadth of the UK, a group of motorists protesting against the amount of Government tax levied on petrol and diesel have achieved a significant victory.

Leaders of FairfuelUK were delighted this week when it became clear that their online petition on the Government’s website had reached 100,000 signatures, the number that determines whether the subject around the petition is debated in Parliament. The petition was supported in Parliament by MP Robert Halfon and a meeting of the Back Bench Committee earlier this week was centred on fixing a date for the debate.

The campaign was set up by Peter Carroll and soon attracted a lot of support from motorists in the UK, high profile names from TV motoring programmes such as Quentin Wilson gave their backing to the website and Quentin went on to become the lead spokesperson for the movement. The group believe motorists already have to bear increasing premiums when they get a online motor insurance quote without being subjected to punitive tax duty on fuel. They are convinced that the Government could easily bring down the cost of petrol and diesel and in doing so would help industry growth.

When asked about the petition reaching the required level of 100,000 signatures Peter Carroll said: “We thank Robert Halfon MP for his sterling work in leading the All Party Working Group on FairFuelUK and every single person who signed the petition. With the economy stagnating, cutting fuel duty represents an effective and fair way of boosting growth, creating jobs and reducing inflation. Petrol and diesel prices are crucifying families and businesses. This issue needs to be debated and action taken.

Although the Fairfuel petition is only the third to achieve the 100,000 it could well be the first to actually be debated in Parliament as the other two petitions have still to be given an allotted slot.

Massive drop in fuel usage reported by AA study

A study by one of the UK’s largest motoring organisations suggests Britain’s drivers are finding their own way round the increasing cost of fuel by simply consuming less petrol and diesel.

The report by the Automobile Association (AA) compared fuel usage today with that of three years ago and the results were quite staggering. According to the AA, fuel consumption for the first half of 2011 is an amazing 1.7 billion litres less than the same period in 2008. The AA put the drop in usage down to the price of both petrol and diesel. With many millions of citizens now having to make drastic budget economies, fuel consumption is coming under the spotlight like never before. A spokesman for the AA said: “Many drivers are struggling to make ends meet in any case, so the high cost of petrol leaves them with no option but to try to use less.”

He went on to explain the drop in usage compared to three years ago is about 15% or 40,000 delivery runs by petrol tankers. Of course a previous report by the AA showed that there are now less people getting cheap motor insurance quotes than in 2008, as there are fewer cars on the road and this extra evidence does appear to suggest the golden age of motoring may well be over.

Hundreds of independent garages have gone out of business in the last 12 months as supermarkets have tried to corner the market by offering “cut price” fuel, however, the “green” community will be delighted with the news that less fuel consumption means at long last, poisonous exhaust emission levels in the atmosphere are beginning to drop.