Fuel profits greater in Shetland than Orkney, says MP
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.