Wednesday, 23 April 2008

Ouch! My hip pocket nerve hurts!

This afternoon, I paid £1.20 a litre for diesel. That's 5p more than when I filled up on Friday before heading home from Site, 200+ miles away. That's not even the worse price in Britain: there is a petrol station in Scotland that briefly charged £1.45/litre on Monday and is currently charging £1.33. Crude oil is over $120 a barrel, and Scotland's only oil refinery (Grangemouth) is closing down in preparation for a strike on Friday (it will take them several weeks to gear up again, even if the strike is cancelled).

On the radio, a somewhat confused oil industry analyst explained that the British are a bit more insulated from the global rise in oil prices because of our high tax/fuel duty regime. I still can't quite get my head around that one. His argument was that over 70p a litre goes to the Government in fuel duty, so we're used to paying higher prices and the proportionate increases in the prices we pay are, therefore, lower than in America. True, but that doesn't excuse the fact that diesel is over 20p/litre more expensive than this time last year!

Fact: our Government will increase duty by an extra 5p/litre this year; last year, they increased it by a similar sum. Seven and a half years ago, there were protests when diesel hit 84p and oil prices peaked. Back then, we were paying approximately 40p a litre duty, so it's increased by 75%.

Fact: The slice of the price of diesel/petrol that goes to the supplier hasn't changed much, even with the oil price rises. It used to be 30p/litre; now it's probably 33p.

Fact: Every litre of petrol/diesel purchased has VAT levied on top of the duty and whatever the supplier makes. That's an extra 17.5% tax on top of everything that we're already required to pay. This afternoon, I purchased an emergency* 6 litres of diesel for £7.19 and paid £1.07 of VAT. Ouch!

Do you see why I have a problem with that guy's argument?

Thank God I drive a fuel efficient car. I worked out the miles per gallon for last week's trip to Site - without altering my driving style, we managed 67 mpg! (In US gallons that's 56.7 mpg. Your gallon is 3.8 litres; ours is 4.5.)

- Pam (off to buy diesel from a cheaper petrol station)

* I had to go to an oil-major's petrol station, so only purchased enough to get me home/to Tesco, where I'll fill the tank tonight and collect my Clubcard points. Tesco, like most supermarkets, charges a couple **of pence less per litre than the oil-major chains.

** (Added later) I've just filled up. Only saved a penny per litre at the pump, but at least my Clubcard points will give me a penny refund on every Pound I've spent.


MrSnarkyPants said...

We buy our fuel from the grocery stores as well ($0.03 off/gallon) but it's still insane. The Honda CR-V that used to cost $26 to fill now costs about $42. I'd hate to see what the folks driving Excursions and Suburbans are paying every time they fill up.

Diesel prices are much higher here than plain ol' unleaded.

PipneyJane said...

Diesel prices are higher here too. I think Unleaded was 8p cheaper a litre yesterday than Diesel. There is a lot of politics in the price of Diesel - it doesn't damage as many votes if you clobber the trucking companies. The fact that 1/3 of all new cars sold run on Diesel is slowly dawning.

When I bought the Toy, it was less than £20 to fill up. When I finally filled up yesterday evening, I spent over £30 to purchase approximately 25 litres of fuel.

< shudder >

- Pam

Christi said...

We gas up at the grocery store most of the time, too. They do a discount that's usually 3cents, but sometimes more. Plus, they don't charge for air when I top off the tires.

I am so so glad I don't have my 120-mile/day commute anymore. Even with a compact car that gets 30 mpg, I was buying gas every third day. DH's commute is only 2 miles, so we're very lucky these days.

I'm waiting for my brother-in-law to start complaining about gas prices again. They "need" a Suburban because they have 2 kids. It was 2 Suburbans, then we convinced them that a sedan would work as a commute vehicle. Now I hear B-I-L has swapped a Suburban for a Kia, and is trying to sell the sedan. He claims the sedan wasn't a good idea if it snowed (they live on a short, very flat piece of unpaved road - if he can't get to the highway in a sedan, he doesn't know how to drive.)

But don't get me started on the whole ethanol/biofuel thing. What a headache.

MrSnarkyPants said...

IIRC, Diesel has been reformulated here to burn cleaner. That also means that once only the clean diesel fuel can be sold, older vehicles will need to be convered to run the fuel.

I rented a van last week in Vegas that ran on Ethanol and found a station that sold it - paid $3.19/gallon as opposed to $3.50/galon. Still cost $80 to fill that beast.