New Warnings That Fuel Prices Are Set To Rise Sharply

Friday, 8. October 2010

Warnings have been issued about the likely increase in the cost of fuel at the pumps. Of course we have the increase in VAT in January but the warning has come as a result of French firm Total putting their 500 service stations up for sale along with its supply contract to a further 300 independent outlets. At the same time Murco have also put their network of 200 retail outlets up for sale which means 10% of all the UK’s petrol stations are up for sale. Projections show diesel increasing to £1.29 per litre in January with petrol increasing to £1.25. We were already seeing an unprecedented loss of forecourts so this is likely to have a major effect on fuel prices as competition reduces along with the increased cost of crude oil. There are now 9,000 fuel stations in the UK of which 1,000 are owned by supermarkets but as they are constantly using the fuel as a loss leader they’re market share is roughly the same as that of the oil company owned outlets (2,000) and the independents (6,000). I fear we have a lot more pain in the pocket to come. By Graham Hill