Oil price plummets

Mr B

Mr B

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Looking at the BBC in the early hours.....
Oil drops 20% making Brent crude @$30.08 a barrel?
I wonder when it’ll drop to 99p per litre ?
 
That would be nice... any reason given????
 
Putin won’t play ball with the OPEC lot, so it looks like it’s a bit of supply and demand battle. And the Saudis are going to pump more black stuff out. So, oversupply means price drop.
That’s if I’ve got it right.
Time to fire up the Quattro ??
 
Wonder what the chancellor will decide about fuel tax in the budget?

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poppycamper said:
Crude oil going down is one thing.... passing it on to us is another... still we can live in hope.
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The retail pump price is basically dependent on the traded product price in Europe and quite often appears to bear little resemblance to crude oil prices, but more on demand in USA and Asia. You have to also bear in mind that the crude normally takes a month or more to get here from the gulf. Of course, the other thing to bear in mind is that most of what you pay per litre is fuel duty and VAT (which is also charged on the fuel duty) so a 20% price shift has a fairly limited effect
 
Demand for oil is down right now, partly due to China not needing as much due to Covid_19 shutting down a lot of their stuff.
 
oil price @30$ a barrel, could we see fuel prices drop to £1 pound a litre.
 
DuxDeluxe said:
The retail pump price is basically dependent on the traded product price in Europe and quite often appears to bear little resemblance to crude oil prices, but more on demand in USA and Asia. You have to also bear in mind that the crude normally takes a month or more to get here from the gulf. Of course, the other thing to bear in mind is that most of what you pay per litre is fuel duty and VAT (which is also charged on the fuel duty) so a 20% price shift has a fairly limited effect
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Strange how a drop in price takes ages to show at the pumps but an increase appears instantly.
 
The major oil companies could mothball some refinery capacity, in order to reduce downstream petrol and diesel supply and help keep pump prices up.

Unfortunately we could still see £1.30 per litre for the foreseeable future especially if Sunak restores the fuel duty escalator. Greenwash rules!
 
Mattyjwr said:
Strange how a drop in price takes ages to show at the pumps but an increase appears instantly.
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Not always the case. It may appear that way, but we recently had a fall in pump prices when crude prices were moving upwards. It is short term supply and demand in Europe. Even with a low crude price, if the arbitrage is worth it then traders will ship it over to USA and make their money there, causing a price spike in Europe. If an Oil trader can make 2% on a deal he is doing well
 
SpeedyDux said:
The major oil companies could mothball some refinery capacity, in order to reduce downstream petrol and diesel supply and help keep pump prices up.
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Well, they have sold off all but the very biggest refineries and opened the door to the second tier refiners like Essar and Ineos. The reason is that big oil only makes money one way; getting the stuff out of the ground. The rest of the chain is almost an inconvenience. Nearly all of your retail Shell sites are franchises and not owned - the margins are simply too thin on retail, except for the flexible smaller companies who can make a few Bob.
 
DuxDeluxe said:
Well, they have sold off all but the very biggest refineries and opened the door to the second tier refiners like Essar and Ineos. The reason is that big oil only makes money one way; getting the stuff out of the ground. The rest of the chain is almost an inconvenience. Nearly all of your retail Shell sites are franchises and not owned - the margins are simply too thin on retail, except for the flexible smaller companies who can make a few Bob.
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Frackers will be screwed by the $30 barrel oil price. They had better hope for a CV vaccine PDQ.
 
Sorry to bring up corona virus, but if it hits like they state, then petrol stations will close as staff sick, those that are open will run out of supplies with tanker drivers off sick, so we are all doomed. Doomed I say.
But look on the bright side, if you die of covid then your children get their inheritance sooner and motorhome prices will drop rapidly. Oops forgot motorhome dealers closed, staff off sick.

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SpeedyDux said:
Frackers will be screwed by the $30 barrel oil price. They had better hope for a CV vaccine PDQ.
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One reason why the Saudi attempt to raise the price by cutting production failed - the frackers can open and shut the taps very easily and very cheaply. Now the Saudis have ramped up production the frackers simply shut things down until the next price cycle. OPEC is a spent force
 
DuxDeluxe said:
The retail pump price is basically dependent on the traded product price in Europe and quite often appears to bear little resemblance to crude oil prices, but more on demand in USA and Asia. You have to also bear in mind that the crude normally takes a month or more to get here from the gulf. Of course, the other thing to bear in mind is that most of what you pay per litre is fuel duty and VAT (which is also charged on the fuel duty) so a 20% price shift has a fairly limited effect
Click to expand...

That said isn’t it strange when crude goes up pump prices rise nearly immediately.

Yet when crude goes down the reason for not lowering is always the price traded a month before ?
 
Silver-Fox said:
That said isn’t it strange when crude goes up pump prices rise nearly immediately.

Yet when crude goes down the reason for not lowering is always the price traded a month before ?
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Not in my experience. It might appear that way but retail fuel is a very competitive business where volume counts more than margin. Sell more fuel, more footfall in the convenience store/shop, more sales. That is where the money is made..... in the shop, not on the forecourt.

a few weeks ago crude prices were rising strongly but the pump price dropped by about 5p over about a week
 
SpeedyDux said:
Frackers will be screwed by the $30 barrel oil price. They had better hope for a CV vaccine PDQ.
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That's why Putin refused to cut production. A) cause the fracking production isn't included & B) to try & make the U.S: suffer. not going to work though for the reason DuxDeluxe said + the Saudis ramping up production/output to maintain income.
 
Price creeping down ( slowly) at the local pumps
Diesel 118.9 today in town

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DuxDeluxe said:
The retail pump price is basically dependent on the traded product price in Europe and quite often appears to bear little resemblance to crude oil prices, but more on demand in USA and Asia. You have to also bear in mind that the crude normally takes a month or more to get here from the gulf. Of course, the other thing to bear in mind is that most of what you pay per litre is fuel duty and VAT (which is also charged on the fuel duty) so a 20% price shift has a fairly limited effect
Click to expand...
Not , when the bloody thing goes up !!
 
Silver-Fox said:
That said isn’t it strange when crude goes up pump prices rise nearly immediately.

Yet when crude goes down the reason for not lowering is always the price traded a month before ?
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Usually 2 weeks delay in seeing the price fall fully according to AA and RAC. petrol companies hedge, so this can also cause delays alongside the other reasons given above.
 

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