Don't blame high fuel costs on the oil companies. Interim results just in from Gencore,the world's largest commodities trader, shows that the Swiss-based company earned $562 million in the first half of the year from oil speculation. That's nearly four times what they made out of trading crude in the same period last year. Now you don't have to be Wittgenstein to work out that over a 12 month period one commodities company will make over a billion dollars buying and selling oil. Factor in all the other firms doing exactly the same thing and you can see why the price of oil has been so volatile recently. The epic rises in price weren't just due to the normal dynamics of supply and demand, but traders buying up millions of gallons at a time, waiting for the price to rise, and then taking a monster profit.
These may be market forces that you can't legislate against, but they're costing our economy dear. And this sort of speculation isn't going to go away given that stocks and bonds have become so unpredictable. Commodity speculation is going to be a major profit generator for large financial institutions over the next few years and its a huge worry. That's why the UK government needs to go some way to counteracting these damaging forces and see the lowering of duty as a badly needed stimulus for our economic recovery.We simply can't have any more duty rises and we must start debating this critical subject transparently in front of the whole nation. When crude rises again (as it will) we need a mechanism to lower duty in order to stimulate growth. To ignore the corrosive effects of oil speculation is reckless. A billion dollars worth of profit from high oil prices is unsustainable.
We need a cut in fuel duty now!