Cost of Fuel

[john75]

It appears that part of the reason that the price of fuel is so high is because BP, Shell seem to be rather making rather large profits maybe a Windfall Tax on them which could be used to pay those who need to use a car/truck to work.

[mybrainhurts]

My local Shell prices are the lowest in the area, even lower than Tesco and Sainsburys....and have been for a few months.

Shell and BP profits are derived from other products, as well as road fuel.

Their fuel profits pale into insignificance compared to the tax taken from you at the pump, being around 230% of the price you pay for fuel.

A "windfall tax" would just work its way back into the price, so it would come out of your own pocket....

[john75]

Think the only alternative might be to use bio fuels.

[voyds9]

john75 said:

It appears that part of the reason that the price of fuel is so high is because BP, Shell seem to be rather making rather large profits maybe a Windfall Tax on them which could be used to pay those who need to use a car/truck to work.

So a business model is succesful and now the government wants to tax the company more, ridiculous. It pays the same rate of tax as other businesses why should it be penalised for being successful.
It would just serve us right if successful business like BP decided to leave Britain as it was more profitable to sell their goods elsewhere.

[munky]

Oil companies make more money as the price of oil / fuel increases. Implies that they make a relatively stable % margin on the product. Certainly the share prices of oil companies track the price of oil itself fairly well.

Therefore, a great way to hedge your fuel costs as an individual is to buy shares in oil refining companies.

Companies, be they airlines or trucking companies, are completely able to hedge fuel prices in the derivatives market if they so wish. Some airlines do this, some don't.

However the price of crude and refined products has fallen back quite a bit in the last couple of days. Crude now $64.37 on Nymex.