It is fortuitous on the day
(Tuesday) Asda announced their petrol prices dropping to 101.7p that MPs asked
questions to a variety of different businesses in the supply chain in
Westminster as to how pump prices are actually calculated when market influences
change. But it’s also clear that today’s RAC’s claim of prices reaching £1.00
per litre before Christmas is most certainly not guaranteed to millions of UK
drivers because of the opaque and unpredictable pricing strategies used by oil
companies through to retailers. The APPG Meeting was arranged by the FairFuelUK
Jason McCartney (Conservative MP for the Colne Valley) and Rob Flello (Labour MP for Stoke on Trent South) lead the All Party Parliamentary Group for Fair Fuel for Motorists and Hauliers in putting the questions with other MPs to these organisations listed below:
Platts, Portland Fuel, Harvest Fuels, Prax Petroleum, the Petrol Retailers Association, Downstream fuel consultants, Fuel card businesses and the Supermarket giant Asda. Noticeable absentees that snubbed the event at the last minute were any of the major UK Oil Corporations or even their Trade Association.
The 3-hour APPG meeting delved into the murky world of pump pricing strategies and attempted to ascertain when oil prices fall or rise, how such changes impact at the pumps for consumers and how they are calculated.
APPG Chairman Jason McCartney MP said: ‘We learned a considerable amount today that regrettably only tells us the pump pricing process is even muddier than first thought. The APPG will continue to investigate the pricing processes involved so that we can help millions of drivers to predict what they will pay more accurately when oil prices fluctuate.’
Quentin Willson, lead campaigner for FairFuelUK said: ‘FairFuelUK’s pricing inquiry heard from industry experts that say 37 million drivers completely imagine rocket and feather pricing at the pumps and amazingly that we all like to drive around garages to find the cheapest fuel. How dishonest is that? The pump pricing shroud of mystery, even after 3 hours of expert evidence, remains.’
Vice Chairman of the APPG Rob Flello MP said: ‘Diesel and petrol wholesale prices are virtually the same and have been so for a long time, so why is diesel continually priced higher at the pumps? It seems from the evidence we heard today that the Fuel Card costs to retailers allegedly may play a part in pricing diesel higher for 50% of UK drivers. We remain confused about the habitual retail difference for these fuels and need to know more.’
Howard Cox, Secretariat to the APPG and Founder of the FairFuelUK Campaign said: "It’s clear after MPs asking fuel supply chain experts, that there is no clear pricing formula we can all call upon to work out how pump prices are calculated. It is a haphazard opportunistic process and attributed by the supply chain experts to market forces and most definitely it seems how much profit they can get away with. Thank heavens, as all agreed at the APPG, some reluctantly, it’s the supermarkets such as Asda who are driving prices down for their customers to fairer levels. Without them we’d be paying even more at the pumps. BUT let’s not forget at £1.00 per litre the Government will be taking 78% in tax every time we fill up. Still the highest in Europe!’
A full report of the 1st APPG into pump pricing inquiry will be published shortly.