Anger as fuel prices remain high while cost of a barrel falls

Fresh calls have been made for the Office of Fair Trading to investigate the stubbornly high prices motorists face at the pumps despite a continuing fall in the cost of a barrel of oil.

Shetland MSP Tavish Scott said a 20 per cent reduction in crude oil prices since April meant there was no justification for the 15 pence premium isles drivers are still charged when they come to fill up.

He has renewed calls made earlier this year for GB Oils, the sole company responsible for getting petrol and diesel to Shetland forecourts, to be brought to book over its monopoly position.

He has also criticised the Office of Fair Trading for failing to take action as prices per litre persistently remain around the £1.50 mark.

Today Brent crude prices fell 1.8 per cent to $106.7 a barrel, amid hopes the conflict in Libya may finally be drawing to a close.

“As world oil prices fall below $110 a barrel, everyone needs to see a fall in pump prices,” Mr Scott said.

“The changing government in Libya and falling international demand means that crude oil is now 20 per cent lower than in April.

“Petrol prices in Shetland tend to only go up. There can now be no justification for that. World wide prices are falling. Supermarkets on the Scottish mainland are in a price war, and we still face a huge 15p extra cost of filling up in Shetland.

“Unfortunately Shetland has only one company importing fuel – they charge what they want but there’s no doubt that Shetlanders pay the highest prices anywhere in the UK.

“Prices must now fall. I’ve asked the Office for Fair Trading to investigate why we pay so much more than Aberdeen or all points south. The OFT have been next to useless so far.

“If prices fall, then at last we will benefit from the changes to world wide prices. But if not, then it is blatant profiteering. That must be investigated by the competition authorities.”


Add Your Comment
  • stephen shirmer

    • August 22nd, 2011 13:57

    The last time i looked at the petrol pumps here it was 90pence a LT for petrol & just over a pound for Diesel.

    It is sourced direct from Russia in bulk, also they have a price fixing system here where all prices have to kept in-line.

    Electricty bills have recently come down for a second time this year, a total of 4%,making our electic bill each month less than £20 as the producers have to keep there profit margin within strict laws (not so sure about the swiss banks)

    Having spent many months working in the Swiss Alps it is interesting to see how the local goverment and regie ( council) having invested in local transport infastructure and project making employment; from horticultural -local food production,agricultural,affordable tourist accomodation, and a BIG windmills dotted here and there to supply a village with electricty, all this has been done to keep the local community thriving and in employment, as rural Switzerland can be as isolated as Shetland, if not more so,there is a policy here that it works and pays for itself or the venture is stopped- no subsidy mentality here

    Lets hope that something can be done to improve the fuel prices at the pump in Shetland as these prices are not stainable without having an economic and social effect on the island in future years.

    Mr stephen Shirmer. Geneva Switzerland.

  • Colin Hunter

    • August 22nd, 2011 15:59

    To add insult to injury, there is still no sign of the Con/Lib Westminster Governments much vaunted 5p duty derogation. Not only is there no sign of it, they have gone suspiciously quiet on that front. Why is that we may wonder? Won’t the nasty big bullies in Brussels let them do it? Or have they just conveniently forgotten about us seeing as how we’re north of Watford! It is high time that successive UK goverments stopped seeing the motorist as a cash cow to be milked of every penny at every opportunity, in order to fund public transport. It is not as though we, in Shetland, will reap any benefit whatsoever from such schemes as the disastrously over budget Edinburgh Tram project, or, in fact, ANY public transport initiative, except, perhaps, the Air discount scheme which I, personally, have never even used once since its inception. I bet there’s a fair few of us that can say the same.

  • S Terris

    • August 22nd, 2011 17:05

    Colin, I’ve written to Tavish asking the same question… May be we already got it and GB Oils put their prices up by 5p?

  • ian tinkler

    • August 22nd, 2011 21:12

    Any SNP input? A bit quiet their also. North of the Pentland Firth, forget it. Good for exploitation of natural resorces only.

  • John Inkster

    • August 22nd, 2011 21:31

    I spoke today (Monday 22 August) to a fuel distributor in southern Scotland who informed me that ” today I can buy road diesel at £1.296 per litre from Grangemouth oil refinery (all prices inclusive of VAT) which I then sell on to the petrol station at £1.344 delivered into their station tanks. They would then sell to the public at about £1.37 to £1.38 per litre.”

    How much does it cost to take fuel from Grangemouth to Shetland? There appears to be a difference of about 25.3 pence per litre between the Grangemouth price and the Shetland pump price.

    I do not understand why there has been so much ongoing debate about this for the last twenty years or so by local politicians when these figures can be obtained by lifting the phone and asking the refinery for a price and a possible transporter (either bulk sea tanker or road tanker) for a shipping cost per litre to Shetland.

  • Steve Jack

    • August 23rd, 2011 9:37

    And the rest…..I’ve just filled up on the mainland for 21p a litre less than I paid just before leaving Shetland on Saturday. A few pence more I can understand, but 21p more is outrageous. Needless to say I’ll be topping up before coming back on the boat on Wednesday! Steve

  • Elizabeth Johnson

    • August 23rd, 2011 19:50

    We just filled up in Aberdeen today for £1.34 a litre and its over £1.60 a litre in Unst!!!

  • Colin Hunter

    • August 24th, 2011 18:45

    In reply to John Inksters question about how much it would cost to transport the fuel to Shetland, I did a wee bit of research some time ago. I was able to find out the cost of Bunker fuel and MGO in Rotterdam at the time and knowing the type of engine ( a 2,400 Kw MAK 8M-25) fitted to the Border Heather, which is one of the coastal tankers used to deliver fuel to Shetland, I was able to figure out, within a reasonable degree of accuracy, how much fuel she would consume on the passage from Grangemouth to Lerwick, approximately a days run (286 Nautical miles or so) at economical speed. If she was carrying a full cargo of 3 Million Litres, the FUEL cost would have been in the region of 0.2 pence per litre! I have actually lost these figures now,as the hard drive in my computer failed and they were on it. I stress that these figures are FUEL only and form a relatively small part of the full daily cost of the ship. However, I would be VERY surprised if the total transport cost per litre was anywhere near the 20p PLUS premium we are currently being charged. Transporting that amount by road tanker would take more than 100 vehicles and the same number of drivers. The Border Heather has a crew of 9.
    300 miles in a truck, doing , at best 8 or 9 MPG would incur a FUEL cost (At,say, £1.30 a litre) of about £210. If the truck was carrying 25,000 litres the cost, per litre, is 0.833 pence, 4 times the cost by ship and transporting an equivalent amount would need more than 10 times as many men! It would appear that somebody, somewhere, is making a killing!

  • Gordon Harmer

    • August 25th, 2011 8:52

    What I want to know is why is this only becoming an issue now as Tavish fought the election with this as a major issue. He is pussy footing around on this, an issue that affects every Shetlander prodigiously. He should be attacking it with the ferocity of a Rottwieler claiming back his bone.
    Come to think of of it as Ian says where is the SNP input what about the wife who got in on a by why are we not hearing from her on this issue. Where do we find her email address or even her name for that matter so we can get her on the case as Tavish seems to be in need of help.

  • Colin Hunter

    • August 25th, 2011 13:18

    Good point Gordon. Her name is Jean Urquhart. I seem to recall her saying that she’d fight on any issue that affected the Northern Isles, Shetland in particular. You’ll find contact details etc here if you want to write to her. I certainly will be.

  • David Smith

    • August 25th, 2011 17:35

    I imagine Jean Urquhart would support a call for an investigation. However as Tavish states the OFT have been pretty useless so far. This is a Westminster imposed tax and until Scotland either becomes independent or gains full fiscal autonomy we are unlikely to see any meaningful change to the present situation.

  • Colin Hunter

    • August 26th, 2011 0:32

    yes David, You’re right! Until we have FULL control over our finances we’re little better than wee bairns being given sweetie money. There are those among us who would argue that that is all Holyrood is capable of, but they are monumentally WRONG! Having gone down the path of devolution, surely the next step should be fiscal autonomy. If for no other reason than to prove the Doubting Thomasses wrong! Full independance may prove a step too far for some, but we,in the outflung areas of the British Isles, will continue to be a non-entity unless we do something about it!

  • Gordon Harmer

    • August 26th, 2011 7:23

    David its not the tax that is the problem its the supplier adding on 20 pence a litre to deliver the fuel to Shetland. Both Colin Hunter and I have researched the cost of delivering the fuel to Shetland and we get the cost to under 2pence a litre. Yes we are being ripped off by the government imposed tax but the biggest rip off is by the supplier. Tavish seems to have no clout with the monopolies commission so we need to get our SNP member to put pressure on them to look at it. Just to add my personal view I think a Holyrood imposed tax will be greater than the present Westminster tax so any change will be up not down.

  • Colin Hunter

    • September 10th, 2011 14:07

    I note with disgust that the price of fuel has risen above the £1.53 mark once more, after fleetingly and tantalisingly dropping to £1.49.9 at a certain outlet in town. This without any rise in the cost of crude oil which has actually fallen, with further falls forecast for the future. This is a truly disgusting state of affairs and the suppliers should be taken to task over it. It not only affects people trying to run a car, but also the price of everything in our shops. Also with winter just around the corner once more, the cost of home heating oil, for those not fortunate enough to have district heating or alternative means of keeping warm.
    At this time, I have had neither reply, nor acknowledgement of receipt of my letter on the subject to Jean Urquhart, so I won’t be holding my breath on that one either!

  • Paul Meyer

    • September 13th, 2011 1:57

    In light of ever increasing high fuel costs that are affecting vehicle owners, I am encouraging islanders to join the Campaign Against High Fuel Costs (CAHFC).

    With approximately 13,500 Private Cars and Light Goods and other vehicles on Shetland, there is a way we motorists can send a strong message to GB Oils that could reduce their profits – and at the same time reduce OUR overall fuel costs and save us millions of pounds a year!

    It is well known by reducing ones speed, slowing acceleration, unnecessarily braking by using gears and half filling the fuel tank, etc., one can make significant savings in both fuel consumption and fuel costs. Because I drive in excess of a 1,000 miles a month, I have been excising a strict ‘fuel economy’ strategy in my driving habits and the resultant savings are clear. I have reduced my fuel consumption by 12% which equates to a weekly saving of £10.

    Ten pounds a week may not seem much, but if ALL 13,500 vehicles on the island excised a strict ‘fuel economy’ strategy in their driving habits, it could reduce the islands weekly fuel costs by approximately £135,000 a week – or over £7 million a year! That could save around 450,000 litres of fuel in a year! GB Oils profits have increased by 15% over the past year, so if we islanders exercise my ‘fuel economy’ strategy we can put a significant dent in their turnover and hopefully their profit margin.

    So how can we all support the Campaign Against High Fuel Costs?

    1) Restrict your speed on main 60mph roads to a maximum of 50mph.
    2) Keep your engine revs low.
    3) Change into 4th or 5th gear as soon as you can.
    4) Avoid fast acceleration and rabbit starts.
    5) Use your gears to de-accelerate and brake only when necessary.
    6) Avoid excessive idling.
    7) Check tyres are correctly inflated.
    8) Keep your distance from the vehicle in front and only overtake if necessary.
    9) Observe speed limits (remember – you don’t have to drive at the maximum speed limit!).
    10) Avoid unnecessarily heavy loads (i.e. half fill the tank!).

    So, to all those drivers who are constantly overtaking my blue Belingo – you may get to your destination just 5 minutes BEFORE me, but remember – you are wasting money and putting more profits into GB Oils!

    Join the Campaign Against High Fuel Costs and together we can all send a a message to GB Oils – and save money at the same time!

  • Colin Hunter

    • September 19th, 2011 10:58

    We hear in the news this week that the 5p duty derogation for the Isles may finally be about to come into force. We are told that it is the highest derogation to be applied by any EU member state so far. That is as it should be because the UK Government must be imposing the highest percentage fuel tax levy in the EU, with more increases planned!
    We also heard that, as soon as the derogation was announced, fuel in the Western Isles increased by 3p a litre, thereby almost wiping out any saving “in a oner!” What is to say that GB oils won’t try to pull the same stunt and trouser the lot? Tavish is absolutely right in attempting to get the OFT involved. It’s a shame that he seems to be up against a brick wall.
    I agree with Paul Meyer that easing off the loud pedal will eventually reduce GB oils take of our money. Another, more direct, method would be to boycott “Leasks” filling station which I believe they now also own outright. Not content with profiteering on the supply side, theyare now jumping on the retail bandwagon as well!

  • Paul Meyer

    • September 20th, 2011 12:49

    Colin Hunter is correct, Leask’s service station in Lerwick is indeed owned by GB Oils.

    To expand on this. what I forgot to mention in my published ‘Letter to the Editor’ on 7th Sept (below), was the Highlands Fuel depot in Lerwick that’s administered by Fuel Card Services Ltd., is a DCC company – and DCC own GB Oils as well as Scottish Fuels.

    This proves conclusively that GB Oils has a monopoly on Shetland. We don’t need the OFT to tell us that!

    Fuel prices in Lerwick went down to a “low” of 149.9p a litre for diesel almost a week before my last fill-up at the Highlands Fuel depot in Lerwick.

    However, on my last statement dated 28th August it was still charging fuel at the old price of 153.22p a litre!

    This is a rip-off. The only reason I use the service is that I get a very small discount on my fuel – as do many other business users in Shetland.

    If it continues to fail to reduce fuel prices in line with local service stations I cannot see the point of using the service in the future.

    Because we can pay up to 20p a litre in Shetland more than on the mainland we are all extremely conscience of fuel pricing, especially when fuel costs are a major expense for businesses in Shetland.

    I have copied this email to our local MSP, and hope all other local businesses who use the service will be made aware of the rip-off pricing policy.

    By the way – when prices increase it is very quick to increase its price per litre!


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