Petrol prices have scrambled upwards at least 11 cents in as many days. To add insult to injury another 2 cents litre was added just before the Christmas break.
The excuses given for this are manifold. We are told that the ‘cold snap' in the Northern Hemisphere increases demand. But most crude oil is sold months in advance on the ‘Futures Market' Therefore yesterday's snow shouldn't affect petrol prices today.
The problem is the ‘Spot Market' where crude oil in excess of ‘forward/futures orders is auctioned.
Any unusual world activity – weather, war elections – can vary the price of oil on the ‘spot market'
The major oil companies set the price of their fuel according to the ‘spot market' - not to their own costs
Therefore, the constantly changing price of petrol is due to speculators, profiting from the ‘spot market' and the oil majors taking advantage of their consumers by using the ‘spot market' prices as a base for their pricing.
The oil companies are not struggling to show a profit. In fact they don't publish their annual accounts, are never audited and pay little or nothing in the way of taxes.
Having created a demand over the years, the oil majors now rip us off.
R.Jordan, Merivale.