20th February 2018
Established 1872. Online since 1996.

Sounding off: Offshore oil no benefit as islanders pay highest fuel prices in the world

, by , in News

PAUL MEYER is the editor of a website, www.ripoff.co.uk, which campaigns on behalf of British consumers for lower prices. He recently moved to Shetland and now lives in Bigton. This week he mounted a one-man protest at the top of the Sound Brae outside Lerwick against the high cost of fuel in the isles. Here, he reveals the findings of his research.

There are two things that are really annoying Shetlanders at this moment in time. One is the proposed retro­spective vehicle excise duty (VED) that will severely hit local crofters and many islanders alike, and the other is escalating fuel prices that seem to increase on a daily basis.

Although the VED fiasco could well be scrapped after the next general election, it is fuel prices that are really worrying everyone.

Only last Friday my wife was in Aberdeen and noted a litre of unleaded petrol was £116.9. In the past it has been accepted, almost without question, that petrol, diesel and heating oil prices were always higher in Shetland because of shipping and transportation costs. In July 2007, I seem to recall there was roughly a 9p or 10p a litre difference between mainland and Shetland fuel prices. That gap has significantly widened to over 15p with unleaded petrol now selling at 133p per litre and diesel at 148p a litre in most, if not all Shetland filling stations.

The cost of heating oil has escalated too and was quoted this week by Scottish Fuels at 69.25p a litre (excluding 5 per cent VAT). If you wanted to fill your 1,000 litre tank you’d now have to find £727.13. In February of this year you’d have paid just £465.36. With no indication that the cost of a barrel of oil is going to decrease signifi­cantly in the near or distant future, this 56 per cent increase in Shetland heating oil prices in just five months means that all Shetlanders who heat with oil will be heading into a deep winter of discontent, with the majority not being able to afford such high fuel costs. Combined with higher food prices, the poorer in our society could both starve and freeze this coming winter.

Is it not time we seriously ques­tioned the widening gap in fuel prices between the mainland and Shetland – and indeed the actual cost of shipping and transporting fuel to us beleaguered islanders?

Last January I was informed by a reliable source that the tankers which leave Grangemouth (Scot­land’s only refinery) are the same tankers that visit Aberdeen, Orkney, Shetland and the Outer Hebrides and that the overall cost of shipping a litre of refined petrol, diesel or fuel oil was half a pence.

Now, even if that has doubled in the past few months one has to beg the question, given local island delivery and petrol station profit estimated at 5 pence a litre, where is the other 10 pence a litre being pocketed?

Not being able to get a straight answer from Scottish Fuels, and their owners GB Oils Ltd., (again owned by DCC Energy plc., based in Dublin) and because these figures are being hidden from the public due to a lack  of transparency, I conducted a survey of other island fuel prices.

Shetland
Petrol: 133p a litre
Diesel: 148p a litre
Heating Oil: 69.25 a litre (ex VAT)
(Supplied by Scottish Fuels)

Orkney
Petrol: 125.8p a litre
Diesel: 138.9p a litre
Heating Oil: 68p a litre (ex VAT)
(Supplied by Scottish Fuels)

Isle of Lewis
Petrol: 128.9p a litre
Diesel: 145.9p a litre
Heating Oil: 70.62 a litre (ex VAT)
(Supplied by Scottish Fuels)

Isle of Man
Petrol: 122.9p a litre
Diesel: 138.9p a litre
Heating Oil: 66.56 a litre (ex VAT)
(Supplied by Shell & Total Fuels)

One must find it rather strange that both Orkney and the Isle of Lewis are selling their fuel products (except Lewis’s heating oil) somewhat cheaper than Shetland. It’s even more surprising when one considers the tanker that delivers fuel to Lewis from Grangemouth has to travel much further by sea than to Shetland.

The Isle of Man is supplied by the Stanlow Oil Refinery at Ellesmere Port in Cheshire. Admittedly the sea miles to deliver the fuel by tanker are not as great as Grangemouth to Shetland – but the figures and obvious differentials still don’t stack up.

It is clear to me that we Shetlanders are being ripped-off. The question is – by whom? If there is a cartel being operated on the island then it must be revealed and dealt with. I have written to Tavish Scott MSP and to the Office of Fair Trading to demand that they investigate fuel prices in Shetland and in other islands in Scotland.

With an abundance of oil remaining off our shores one must also question why we in Shetland are now enduring the highest fuel costs on the planet, and why we haven’t invested in a micro-oil refinery?

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