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Petrol price review by OFT

by Admin

The Office of Fair Trading (OFT) has this week issued a call for information on the prices that consumers are paying at the pumps for petrol and diesel. They intend to investigate a number of things, notably whether there is sufficient competition between suppliers to lower prices, and whether or not a fall in the price of crude oil is reflected by lower prices for consumers at the pumps.

This last question is a bit of a hot topic for many petrol users as they feel that although oil prices are not at their peak, petrol is more expensive than ever. This great chart from Whatgas compares the price of petrol in green with the underlying cost of crude oil in blue:

As you can see, although the price of petrol does follow the cost of oil, it seems that there is a much larger gap between the oil cost and the price at the pumps since the oil price dropped in the middle of 2009. As the people at Whatgas say, some of this is due to currency fluctuations (oil is traded in US dollars, not pounds Sterling) and increases in fuel duty. The OFT will be investigating whether the whole discrepancy can be accounted for through “legitimate” reasons, or if they believe petrol companies are behaving unfairly and fixing the price higher than clean competition would suggest. The OFT expect to publish their findings in January 2013.

As a final thought, the BBC’s article about this investigation includes this interesting chart showing how the total price for each litre breaks down:

Tags: crude oil, diesel, Office of Fair Trading, petrol, petrol prices