Fuel profits greater in Shetland than Orkney, says MP

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The profit made by fuel retailers in Shetland is more than one-and-a-half pence a litre greater than in Orkney due to a lack of competition, according to isles’ MP Alistair Carmichael.

And he says the lack of transparency in the wholesale fuel market leaves “a lot to be desired”.

His comments were made after he attended a fuel summit in Glasgow on Thursday which brought together MPs, The Office of Fair Trading and wholesalers. He said the meeting was useful and something he hoped would be repeated.

He was particularly interested to learn of the discrepancy between the profit margin.

Mr Carmichael said: “The meeting’s real usefulness was throwing in to sharp relief the difficulties caused by the lack of transparency. According to the figures supplied by GB Oils [Shetland's only major oil supplier] to the OFT, the profit margin in Orkney is 3.4 pence per litre (ppl) while it is 5ppl in Shetland. I would like to know what that difference comes from.

“The obvious answer is that there is more competition in the wholesale market in Orkney than there is in Shetland.

“To be fair, GB Oils say that there are other factors at play involving operating costs. I think that we need to be told how the operating costs can be so markedly different. I have been promised historic data for the period from 2007 when GB Oils took over. That should shed some light on the situation.

“The OFT investigation in the Western Isles should now run its course but will, I hope, reach an early conclusion. Once we see the lessons from there, we should be asking whether the same rules might be applicable in the Northern Isles.”

For Mr Carmichael’s reaction to the OFT investigation into fuel prices see this week’s paper.

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One comment

  1. Stewart Mack

    What we need here is some action by our elected representatives. We have had meeting after meeting, an OFT “investigation”, and i use the term loosely, calls for this, calls for that and it still remains the same – Europes largest Oil refinery hosts some of the most expensive fuel available anywhere in the civilised world. We already know it costs 1ppl to transport from the mainland, so why is the fuel so much higher inspite of the rebate? Something doesnt stack up. What we need is a national price for fuel from London to Lerwick and everywhere in between. Fuel is not a commodity that should fund profiteering by GB Oils or anyone else, it is the lifeblood of our community. The public trasport is (relatively) good in Shetland, for an island community but nowhere even remotely near to being a viable alternative to a car for anyone outside the town- So come on, you are elected to represent your constituents, speak to your fellow MSP’s from remote communities, its easy, contact details are listed on the Parliament website, and get something done about it.

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