Anyone else concerned about the price of fuel?

[cormissus]

Yesterday it was £1.66 near us a litre and today it’s £1.71. It seems to be climbing by the day and although I hear tuts and sighs most people just seem to be accepting it. The government hasn’t said a word - but mind you they’ve made approximately £130million in excess VAT since Feb when this conflict started. I recently switched to a hybrid so it’s not costing me quite as much but I wonder how high the government is prepared to let it go before they will slash the VAT?

We have a large diesel car, mainly because we tow a caravan and use that a lot for all our holidays and also DH sleeps in the back of it for his hobby events if they are a long way from home but both a lot less in winter so we could manage to just use the petrol Fiesta for most journeys and just occasionally use the diesel.

This is concerning. I just heard the radio with the line from the Gov that there are no upcoming issues with gas supply.

These posts on here make more sense.

Two friends of mine have said re potential shortages and rationing "They won't allow this to happen".

I'm not quite sure who my friends think this "they" are and what magical powers they have to make more diesel than is being produced appear out of nowhere.

They don't have further answers as to how "they" might provide solutions if there is a world wide shortage

It is a disbelief and a denial of something they don't want to conceive as being a possibility. It's a reverse fantasy though which isn't reflected in real world actions.

Gas as in natural gas is holding steady in terms of supply versus demand. It will be more expensive but I think there will probably be enough (not least because the cost itself will reduce consumption).

Diesel has the bottleneck of refining and its the back bone of logistics. We have less capacity and margin of shortfall we can adjust for before a cascade effect kicks in.

Think of an army that overextends it's front line and what happens. It will get hammered and have to force a retreat under fire, often to a position behind its original jump off point. An army is only as good as it's logistics capacity. It can have the best bombs but wars are won and lost on logistics. Failure of its logistics can result in a complete collapse.

This logic underpins our entire economy. Especially in a just in time supply system.

It is concerning...

Before the "well that fuel price means less flying, hurrah" cohort pop up to crow I should maybe mention that jet fuel price has the potential to clobber much more than peoples' weekend breaks and holidays, it will also hit air freight.

Just so happens that as with a lot of goods where transit times are critical a lot of pharma is airfreighted around, certainly into the UK.

There's potential for those fuel prices to feed through into the price of medications and much more.

Yes the messaging did use the line with gas but it means no one is asking or talking about diesel or jet fuel. That really matters as you and @notimagainsay, it’s false comfort.

Fuel prices are going to massively impact drug supplies.

Pakistan relies on gas from Qatar. When Qatars facilities got bombed by Iran this has caused major shortages in Pakistan. They have been experiencing regular blackouts in manufacturing. This has also resulted in prices spiralling. The government has started to put in energy and cost saving measures for companies and state employees. They are now using back up generators run on diesel.

India is also has significant exposed to a massive hike in gas and diesel prices. Given this is where so many of our drugs are manufactured this is a problem. The UK over recent months has been reporting low drug inventories. The costs of some has gone through the roof. And that's before you consider getting them from India to the UK.

This has significant implications for the NHS.

I have been into a local Boots over the last few months and tbh the emptiness on the shelves is staggering. Lots of gaps everywhere. This is only going to get worse too.

I have a rule about the media.

It's not always just about what they tell you.
It's also about what omissions there are and what they don't tell you.

The omissions are often more important.

I have said this for years on MN.

There are some huge communication gaps between the public and government on key crisis issues right now.

It's beginning to get noticed.

I drive a tiny crappy car and normally spend about £20 a week on petrol...but have been visiting my partner in hospital this last week...its costing me a fortune...im on minimum wage and just cant cut back anymore..i dont go to pubs anymore...rarely eat out...dont buy clothes etc.
I am starting a 2nd top up job tomorrow (sunday) in a coffee shop...which means a 6 day week but i cant see any other way.

That is true, Labour are adept at this. Hide behind careful messaging.

I mean, there's the issue of 'we've been here before' and it wasn't even that long ago, only earlier this year. Fuel prices shot up, we were warned there could be fuel rationing, that our summer holidays might be cancelled. And then fuel prices came down again and everyone had a lovely holiday.

Why would that not be the case again this time?

Yeah, very worried. Not looking good at all

Because we haven't gone back to normal, we're effectively running on back up supply, using what used to be secondary sources..

This is one for the oil industry experts but as I understand it we only got where we are now by in effect shifting to alternative sources, in the case of Europe perhaps looking to the US to plug the gaps due to lack of output from the ME, but sometimes at a cost.

If the supply chain gets further throttled there may well be no third tier of supply to further fall back on.

And then fuel prices came down again and everyone had a lovely holiday.

Actually in the aviation world they didn't really come back down that much and not for long...see the IATA website I linked to in a post upthread.

Most (but not all) companies got by without widespread cancellations because those supplies from secondary sources arrived, and because many companies had hedged their fuel contracts into the autumn.

Even if supply continues IMO if the jet fuel price stays where it is now some people will not be going on the holidays they have booked for next year and/or fares are going to escalate fairly quickly.

Now I know "if" is doing a lot of heavy lifting in there but the airline situation is looking slightly scary from the POV of someone who used to work in it and has seen the ups and downs of several economic cycles.

If you want my advice with regard to flying this winter and beyond - assume nothing, book with a credit card, make sure travel insurance is comprehensive, and don't start grumbling it is just the airlines are gouging if fares and other fees start going up..

I'm a home carer in very rural Yorkshire. My elderly clients live a 30-45 minute drive from one another.
In what world would a bike be of any use to me in my job?

Have you ever actually visited "the country" and, indeed, held a job which requires essential car journeys across all weather conditions, narrow single-track roads, and steep terrain?

Get real.

1. Infrastructure is gone. It will take time to rebuild even if the conflicts end tomorrow.
2. At the start of the conflict, a certain amount of Western fuel reserves were released to ease pressure. Reserves aren't bottomless. There is an awareness of this.
3. China stopped buying and instead used reserves. This took a huge amount of pressure off the market. Reserves aren't bottomless.
4. Politically there's a couple of strategic points for both the US and Iran now. It is expected to last unless at least the midterms because both sides have reason not to back down.
5. Lots of businesses survived the earlier conflict. They can't survive another round especially if it is protracted. (See airlines. Ustruck drivers are often contractors who pay their own fuel - if it's not making money they quit the industry. Also see farmers quitting land permanently - loss of skills and essential logistics and resources)
6. The Saudis have said no crude to European customers until Nov at earliest. This is set in stone.
7. Fertiliser shortages earlier in the year have not fully been understood in terms of their eventual impact - unrest and famine. Shortages now only compound a problem which is now fixed to happen
8. The US military is a busted flush. Iran has totalled rather more than has been admitted. This is leading to re-evaluations of geopolitical position and power around the world. The USs fear factor has gone. The US doesn't have the capability to fight on multiple fronts. This is changing economics too.
9. Even though adaptions to getting oil out has been done, it's been at considerable expense. It is much more costly to transport because of insurance and security. Those security concerns will not disappear even if the war ended immediately. We are facing higher costs for some time due to a long term destabilisation.
10. The Yemen situation vastly changes various equations. Saudi Arabia is screwed as this conflict is separate to Iran v US and has a long history.

There are other considerations too.

But the best way I can sum it up is, it can't 'go back to normal', because 'normal' is a place in time that ceased to exist when the US resumed it's campaign.

One of the big calculations now is that the markets and politicians really now see this as a middle to long term fundamental change.

Financially the airlines are going to have to make some decisions about flights now about fares and timetabling.

They have to make decisions on what they know now and plan conservatively. They can't wait for it to get better when the expectation has shifted to short term to longer term.

Boris Johnson wasn’t going to allow lockdown to happen, was he? Until he did.

He also wasn’t going to allow Christmas 2020 to be cancelled, as “it would be inhumane”. And then he did.

And in January, he said “schools are safe”. They were closed the next day.

Never believe anyone who says “it will never happen”.

Yep. This was screamingly obvious during the madness of 2020 and 2021. What they did not tell us spoke volumes.

”100,000 Covid deaths, I’m so sorry,” grovellled Boris. Were those deaths OF or WITH covid?

And how many deaths were caused by lockdown? Is a government going to grovel about that?

Also, how many people die each year? 600,000 or so?

Can I ask what is probably a stupid question. If there was concern about all this back in February why isnt rationing of say non essential use of fuel (eg private jets) already happening as a cautionary mechanism? Causing panic? Appreciate none of this is simple.

I guess you'd have to ask HMG..

I think way back in the spring there was hope any restrictions on supplies would be short lived..

And yet here we are...

As far as private jets go I don't restricting them would help the overall situation that much. I know the likes of H and M has made them controversial and has raised public awareness but I don't think their use is as common as many people seem to think.

It's costly and it would damage the economy in other ways by changing spending patterns.

Rationing has to only come in when you are running out of other options and the goal is to put the economy on life support.

One reason is: money talks.

The rich and famous are not going to start by restricting themselves: that’s what the peasants are supposed to do. Boris Johnson thought roolz and restrictions were beneath him, as we know.

Sticking with this, though it's maybe a tangent off a tangent, but i's not always just money talking.

Not all business jet use is frivolous or none essential - there can be genuine business needs for using bizjets to move people or even equipment around pronto and they get used on occasions for medical repatriation etc...I've even travelled bizjet on one occasion when my employer needed me and a collague somewhere really quickly and commercial air wasn't an option and I'm neither rich or famous.

If your aim reaĺly is to reduce jet fuel use because of the shortage, and your intention is to do that by stopping travel for frivolous purposes then OK, maybe consider a bizjet ban but you also have to consider maybe a ban on things like hen and stag parties flying.

The rich and famous didn't restrict themselves in covid, they were all trotting off overseas. Didn't some singer have a party and pretty much said whoops and paid a fine. If you could afford the fines you could pretty much do what you liked.

I have noticed it has gone up in the last couple of days diesel where I am is now £1.99, unleaded is £1.76.

Also this is fuel they would have brought when it was expensive. It will go down again in a couple of weeks.