Just who profits from high fuel prices

Thinking about it last night and although we don’t like high fuel prices but just who is making the profit out of increased prices.

The Government gets 38c in the litre excise plus the GST take. With higher prices the Excise doesn’t change, if anything higher prices mean less sold so the Govt share from Excise drops. GST is calculate at 1/11 of the retail price so when fuel is at $1 p/lt and then increases t $1.30 p/lt the GST take only increases by .03c p/lt.

Refineries are in the main owned by multinational oil companies, and when prices are increasing rapidly its pretty easy to add an extra cent here and there and with the volumes processed it adds up to a lot of money. And from what has been published recently they have been increasing margins dramatically.

Retail shops, we have seen an increase in cost of goods supposedly due to higher transport costs caused by fuel cost increases. Yet the truckies are protesting about the higher costs their incurring. Obviously this higher price charged by Retailers has not found its way to the people who need it, the transporters. Looks like the Coles & Woolies of this world are also reaping profits from the situation.

The Oil producers, most the capital expenditure for their facilities were costed and built when the price of oil was a lot lower. Sure they have to factor risk and investment costs into their commercial decisions and make a profit. As a lot of these facilities take years to come on stream, you cant say that they knew then that prices where going to get this high, that long ago. Looks like these guys are making a killing as well.

The Fuel retailers like Woolies, Coles etc (excluding the independents) discount dockets are now common. How often do people look at the marked price? We mainly look at what we will pay including the discount, this has the effect of an instant 4c ltr rise at the bowser. Sure they’re giving away a discount but every time you go in with out a docket you pay a higher price.

Fuel is a commodity traded on a world market and subject to the vagrancies of supply and demand, and that cant be changed. To get the Government to drop its excise or provide assistance will mean that some other service will suffer or taxes will rise in another area.

Target the people who are profiting from the situation, lets make sure the Transporters of goods get their increased rates to keep them on the road, we are paying for it any way. Make sure the refineries lower their wholesale costs. Consider using the CHEAPEST petrol station (disregarding discount vouchers) and if you have a voucher for discount then that is a bonus.

I am off my soap box now.

Alan