Star comment: Fuel price cut is not that great
The fall in prices at the petrol pumps will have been welcomed by many people who will be saving a few pounds per week on their cost of living. But there is a more disturbing story behind the headline fall in cost.
The truth is we're not getting such a good deal after all. Britain lags far behind its continental cousins when it comes to providing value for money.
Global prices have fallen sharply, but the prices at the pumps have not.
Austria, Belgium, France, Germany, Spain and Holland are among countries who have reduced fuel prices by more than the UK. Prices here have been cut by 2.7 per cent but in some parts of Europe they have fallen more than twice as quickly.
British motorists have become accustomed to paying more than 130p per litre. When prices fall below that threshold, they instantly think they are in the money. Motorists are so grateful to be paying a little less that they think they are quids in.
In fact, the businesses who supply our fuel are the ones who are laughing all the way to the bank as they pass on minimal savings to motorists and increase their own profit margins.
The cost of fuel is a huge issue for all of us, particularly in a rural county like Shropshire. While town centre supermarkets are able to discount fuel to as little as 127.5p for a litre of diesel, those who live in rural areas pay up to 9p more per litre. That is because of the increased costs of distribution. Many rural petrol stations have gone under in recent times, those that have survived have to charge a little more.
The cost of service provision in Shropshire is intrinsically more expensive than it is in urban areas in nearby West Midlands boroughs. Our towns are further apart, which means we have to travel further to get things done. And that costs money, which impacts on the bottom line.
The news, therefore, that wholesalers have achieved savings of up to 6.6 per cent in Europe, but only 2.7 per cent in the UK, is alarming. Petrol and diesel are the lubricants that keep the wheels of our economy turning. Without them, we are lost.
Better safeguards ought to be in place to ensure motorists, rather than wholesalers, are the beneficiaries of a global fall in prices.
