diesel outpricing petrol..why?

Colonel Sanders

mcaul wrote: »

The oil companies have a set way of establishing retail prices and this is revised every week on a Tuesday. When the markets are particularly volatile the prices are revised Tuesdays & Fridays. So normally you see prices change in most garages on Tuesdays, sometimes Wednesdays and next Tuesday should see a drop of 3c in Petrol & possily 4c on Diesel.

I have seen certain garages (in fairness not all) change the prices on an almost daily basis when prices were increasing.

NinjaTruncs

mcaul wrote: »

though at the same time, the US Dollar may strengthen so a 25% drop in oil prices may in reality be ony 20% at world level and translate to about 10% - 15% drop at retail level (duty levels, refining costs etc don't change)

Are you saying that if the Dollar gets stronger Oil prices will go up? I believe it to the the oother way. One reason why oil prices have gone up is becasue the Dollar has gotten so weak. so if the dollar strenghtens the price of oil should go down.

Padraig Mor

mcaul wrote: »

The oil companies have a set way of establishing retail prices and this is revised every week on a Tuesday. When the markets are particularly volatile the prices are revised Tuesdays & Fridays. So normally you see prices change in most garages on Tuesdays, sometimes Wednesdays and next Tuesday should see a drop of 3c in Petrol & possily 4c on Diesel.)

Now call me cynical but why should the price at garages go up just because the wholesale price has raised? Surely the garages only pay the increased price for fuel when they actually receive their next delivery after the increase? And if they raise before then they're only skimming off extra profit? Like shops who raise fags etc the day after a budget increase, even though they don't pay the higher price for some time. Or do I have it wrong?

Colonel Sanders

Padraig Mor wrote: »

Now call me cynical but why should the price at garages go up just because the wholesale price has raised? Surely the garages only pay the increased price for fuel when they actually receive their next delivery after the increase? And if they raise before then they're only skimming off extra profit? Like shops who raise fags etc the day after a budget increase, even though they don't pay the higher price for some time. Or do I have it wrong?

I think someone said earlier in the thread that its priced at replacement value. Hence the price should come down at the pumps seeing as the price of a barrel of oil has fallen to about the 125$ mark. Not holding my breath that they'll lower it as quickly as they increased it over the last few months

Mollywolly

Padraig Mor wrote: »

Now call me cynical but why should the price at garages go up just because the wholesale price has raised? Surely the garages only pay the increased price for fuel when they actually receive their next delivery after the increase? And if they raise before then they're only skimming off extra profit? Like shops who raise fags etc the day after a budget increase, even though they don't pay the higher price for some time. Or do I have it wrong?

I don't think you're cynical, because if you are, then the whole lot of us unlucky punters are in the same boat! I'm fortunate that our local garage seems to hold on for as long as possible before they put up the price -if only everyone was like that

Del2005

NinjaTruncs wrote: »

Are you saying that if the Dollar gets stronger Oil prices will go up? I believe it to the the oother way. One reason why oil prices have gone up is becasue the Dollar has gotten so weak. so if the dollar strenghtens the price of oil should go down.

What they are saying is that the Euro has been worth ~$1.55 for the last while.

If the Dollar gains on the Euro then you get less $s for you're €, so when you buy something in $s you have to give more €s.

parsi

Padraig Mor wrote: »

Like shops who raise fags etc the day after a budget increase, even though they don't pay the higher price for some time. Or do I have it wrong?

You do for the shops. When Excise Duty goes up it's operative on all sales from the time it's raised so a pack of fags is chargeable at the old rate at 23:59 but come midnight the new rates applies and is immediately chargeable.

Now the increase in petrol prices due to increased cost to the retailer is anotehr kettle of fish..

the_syco

I'll stick by my theory of: Saudi's get less money, they reduce the amount of output to raise the price, so that they'd get their money.

=-=

Question: what percentage does Russia have NOW? Not 2 years ago, as Russia has been, erm, "aquiring" oil companies, and jailing their owners, so would love to know mow much they bring to the stage.

Also, are they members of OPEC?

mcaul

Not sure if this will cgeer you up, but throughout the north, petrol was on average £1.25 sterling and diesel £1.36 sterling.

What was even worse was the UK budget in April increased the duty on all spirits, so even a bottle of brandy to soothe the effects of price rises had virtually no saving £23.99 for std Martell in sainsburys against €31.99 here.

r3nu4l

Are Tesco still cheaper than everywhere else in Ireland? Over where I live they are either the same price or 1p per litre DEARER than all the other garages!!

Of course, if you spend >£50 in the shop, you get 5p off every litre of fuel you buy...

NinjaTruncs

parsi wrote: »

You do for the shops. When Excise Duty goes up it's operative on all sales from the time it's raised so a pack of fags is chargeable at the old rate at 23:59 but come midnight the new rates applies and is immediately chargeable.

that's not true about the duty on smokes. A shop is charged the duty on them when they're bought from the supplier, so when the go up in the budget and a shop puts them up the next day it's pure profit for the shop.

Padraig Mor

parsi wrote: »

You do for the shops. When Excise Duty goes up it's operative on all sales from the time it's raised so a pack of fags is chargeable at the old rate at 23:59 but come midnight the new rates applies and is immediately chargeable.

Now the increase in petrol prices due to increased cost to the retailer is anotehr kettle of fish..

You sure about that? You may be thinking of VAT. It's *excise* duty, which I would imagine is applied when the goods enter the country, i.e. at a bonded warehouse even before they go to the supplier's depot. "Enterprising" retailers could even order massive amounts before an expected budget excise increase and cream off the extra 50 cent per pack (or whatever) for months. I'm sure that wouldn't happen in Ireland though...

Colonel Sanders

r3nu4l wrote: »

Are Tesco still cheaper than everywhere else in Ireland? Over where I live they are either the same price or 1p per litre DEARER than all the other garages!!

Of course, if you spend >£50 in the shop, you get 5p off every litre of fuel you buy...

diesel was 134.9c in tesco wexford yesterday, I saw it for the same price in 2 places and for 2c in the maxol across the bridge.

On the way to work today i didn't see any garages had reduced the price of diesel despite the price of a barrle of oil falling in the last week......

highlydebased

It has little to do with the price of oil.

With the new VRT rules coming into affect very shortly, it will be much cheaper for people to buy diesel motors with larger engines. In fact it would be cheaper to tax a 3.0 litre diesel than a 1.6 petrol in some instances. the government are going to loose out on revenue here, as most people will see the opportunity and purchase diesel, so to make up the loss, the government have decided to increase the tax on Diesel.

Colonel Sanders

Neon-Circles wrote: »

as most people will see the opportunity and purchase diesel, so to make up the loss, the government have decided to increase the tax on Diesel.

HAVE YOU A SOURCE FOR THIS, WAS IT NOT THE CASE THAT THE DUTY ON DIESEL USED TO BE LESS THAN THE DUTY ON PETROL?

EDIT: just noticed I'd caps lock on when writing that!!!!

mcaul

Neon-Circles wrote: »

It has little to do with the price of oil.

With the new VRT rules coming into affect very shortly, it will be much cheaper for people to buy diesel motors with larger engines. In fact it would be cheaper to tax a 3.0 litre diesel than a 1.6 petrol in some instances. the government are going to loose out on revenue here, as most people will see the opportunity and purchase diesel, so to make up the loss, the government have decided to increase the tax on Diesel.

There's not a chance in hell of the government increasing tax on diesel - all truckers, fishermen, independent bus drivers would protest on the spot and bring the country to its knees!


Here's the US delivered to port prices from the refineries for diesel since April. Prices are per US Gallon (3.6 litres). Prices changes take approx 10 - 14 days to hit the pumps. Todays price is $3.84

2008 Apr- 7 to Apr-11 329.50 336.00 349.45 338.86 333.65
2008 Apr-14 to Apr-18 333.49 342.00 343.10 341.93 345.15
2008 Apr-21 to Apr-25 347.69 348.33 349.21 343.60 350.70
2008 Apr-28 to May- 2 346.50 341.74 338.67 330.34 339.73
2008 May- 5 to May- 9 350.50 353.77 364.10 371.08 383.52

2008 May-12 to May-16 371.50 386.19 378.35 381.46 389.40
2008 May-19 to May-23 386.77 395.50 411.90 412.33 405.20
2008 May-26 to May-30 closed 396.86 395.85


Here's a breakdown of the 1.44 / litre diesel price

Price to port $3.95 per 3.6 litres = 73.2c (euro)
Irish Duty = 36.8c
VAT on 1.44 = 24c

Balance = 10c for local distributor + garage.

for every 10c increase / decrease in the NYMEX price per gallon, a increase / decrease of 2.5c per litre is fed into retail prices assuming the US dollar stays static.

Here's the US port price from 1986 for diesel - in 1986 it fell as low as 25c per gallon!!!
http://tonto.eia.doe.gov/dnav/pet/hist/rdllad.htm

mcaul

I really must get busy on my real job!!!:D

The good news is diesel delivered to port has dropped almost 10% from highs and prices should see decline to about 1.33 in the next 2 weeks and further if the current downtrend continues as most analysts expect.
High was $4.12, yesterday's close was $3.73 per US Gallon (3.6 litres)

Here's a graph showing how diesel suddenly went ahead of regular gasoline on the world market at the end of Feb
http://www.profitquotes.com/cgi/?a=chart&ticker=%2FLU_C%2C%2FLR_C&title=1+Year+Growth+Comparison&period=1yp

Danno

So there is VAT on duty - is that not an illegal taxation? How can you tax a tax?

Del2005

Danno wrote: »

So there is VAT on duty - is that not an illegal taxation? How can you tax a tax?

Cause they can. Same with VRT, you get charged VAT on the OMSP plus VRT(or the other way round).

ircoha

Danno wrote: »

So there is VAT on duty - is that not an illegal taxation? How can you tax a tax?

same on stuff imported from states
eg on clothes duty is 12 % which is added to the price and then 21% on the lot

pickarooney

Diesel is still considerably cheaper (€1.28/litre) than petrol (€1.46/litre) here in France. How does that tally with the inverse being the case worldwide?

Colonel Sanders

I remember reading years ago that duty on diesel is less than it is on petrol. Wasn't sure if this was the case til i picked up the Irish Times yesterday and there was a small article about fuel prices. In it it was stated that the duty on a litre of diesel is 8c less than it is on petrol. Some stations are charging as much as 12c more for diesel so adding in the effect of the difference in duty that makes a 20c difference if you get my drift.

How can this be so?

mcaul

Its to do with prices of the different refined products of Diesel & Petrol (gasoline).

The current price of Diesel delivered to Port is $4.17 per US Gallon (3.6litres)
http://www.profitquotes.com/commodities-quotes.mpl?c=LU&n=Gulf%20Coast%20Ultra%20Low%20Sulfur%20Diesel

The current price of unleaded petrol delivered to port is $3.51
http://www.profitquotes.com/commodities-quotes.mpl?a=detailed&ticker=/LR8N

Up until mid February both prices were similar and then diesel prices just spiked away from petrol and have stayed about 15% higher ever since.

Prices are dropping today by 4 / 5%, so hopfully friday's ridiculous jump won't feed its way too much to the pumps.

What's it caused by - gamblers! - Same guys who ran the dot com bubble, the same guys who caused exchange rates to go wild before the euro and currently they're at oil. The rise will end, maybe today, or tomorrow, possibly next week, or next month - ask ten analysts and you'll get 10 diffferent answers as to the timing, but all agree it will end sometime soon. (hopefully in time for next winter's heating oil delivery!

Danno

Well fcuk to these gamblers. A swing of a hurl to the back of the head is what they deserve.