Forecourt Trader - 30 years at the heart of the fuel retailing community

Don't be taken in

01 October, 2004
Page 8 
I read an article which concentrated on the recent volatile rise of the oil price. This commodity is in short supply and has a growing demand. We are told that problems in Russia/Nigeria Venezuela/Iraq or demand in China/India/USA are to blame, and each news item from any of these countries puts the price up. Such is the money to be made from the speculation on oil that many banks have set up specialist departments, and these same banks are even offering supplies to large users. The example was Morgan Stanley
supplying one of the American Airlines.The price is not being driven up by the oil producers such as OPEC, but by oil traders. How very convenient, then, for the oil companies offering Platts-only deals. While they suggest that the Platts price is honest, open and fair, the reality is that the oil companies are oil traders themselves, driving the price up or down with their computer-generated trading models, but going on to blame their windfall profits on ‘oil traders’ as though they were not traders themselves, and were not making huge profits on internal transfer prices.The Platts model allows the oil companies to make profits at every level in the chain – exploration, production, refining, delivering, wholesaling, retailing. The widget manufacturer gets one bite at the cherry. The oil company gets far more, and influences everything after production through Platts. Oil traders skew the market. I’ve heard so many retailers say that if we were all on Platts, we would have a level playing field. That is nonsense. Some buy at high CIF, some at low CIF, some at Platts minus, rather than Platts plus. But the only people who cannot lose on a commodity which is diminishing in supply, but for which there is a growing demand, are the oil companies. So don’t be taken in by the claims that ‘marketing’ isn’t making any money. They’ve just shifted the profit further up the chain. Paul Sykes, Shaw Petroleum, Huddersfield



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Weekly retail fuel prices: 15 January 2018
RegionDieselLPGSuper ULUL
East124.9460.90131.85122.27
East Midlands124.34132.31121.54
London125.0662.90132.42122.10
North East123.94133.63121.07
North West124.1658.50132.51121.18
Northern Ireland123.4169.90128.40120.85
Scotland124.5774.90130.88121.33
South East125.1561.40132.52122.48
South West124.73130.24121.91
Wales124.44128.57121.19
West Midlands123.7465.23132.27121.20
Yorkshire & Humber123.9161.90132.74121.12

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