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Danny Alexander to call for fuel price cut | Danny Alexander to call for fuel price cut |
(35 minutes later) | |
The chief secretary to the Treasury is to urge petrol and diesel distributors to cut prices further after recent declines in the cost of oil. | The chief secretary to the Treasury is to urge petrol and diesel distributors to cut prices further after recent declines in the cost of oil. |
Oil has fallen from about $115 (£72) per barrel in June to about $84 per barrel, a decline of about a quarter. | Oil has fallen from about $115 (£72) per barrel in June to about $84 per barrel, a decline of about a quarter. |
In comparison, petrol prices in the UK have fallen from a high of about 131.7 pence per litre in the summer to 124.22 pence - a decline of about 6%. | In comparison, petrol prices in the UK have fallen from a high of about 131.7 pence per litre in the summer to 124.22 pence - a decline of about 6%. |
Danny Alexander is to demand assurances price cuts will be passed on. | Danny Alexander is to demand assurances price cuts will be passed on. |
Mr Alexander will use a speech in Aberdeen to warn people would "rightly be angry" if they felt prices were not coming down as much as they should. | Mr Alexander will use a speech in Aberdeen to warn people would "rightly be angry" if they felt prices were not coming down as much as they should. |
For diesel the drop is from 136.37 pence per litre to 128.58 pence. | For diesel the drop is from 136.37 pence per litre to 128.58 pence. |
"I believe it's called the rocket and feather effect," he will say, in prepared remarks seen by the BBC for a speech to the Highlands & Islands Branch of The Energy Institute in Aberdeen. | "I believe it's called the rocket and feather effect," he will say, in prepared remarks seen by the BBC for a speech to the Highlands & Islands Branch of The Energy Institute in Aberdeen. |
"The public have a suspicion that when the price of oil rises, pump prices go up like a rocket. But when the price of oil falls, pump prices drift down like a feather." | "The public have a suspicion that when the price of oil rises, pump prices go up like a rocket. But when the price of oil falls, pump prices drift down like a feather." |
While no research supports this, the thought of this effect creates ill feeling, he will say. | While no research supports this, the thought of this effect creates ill feeling, he will say. |
During the period, the pound has weakened against the dollar. Whereas a pound bought $1.7165 at its height in the summer, it now buys $1.598 - a drop of 6.9% | During the period, the pound has weakened against the dollar. Whereas a pound bought $1.7165 at its height in the summer, it now buys $1.598 - a drop of 6.9% |
Because oil is traded in dollars, the weaker pound has reduced the effect of the drop in oil for UK consumers. | Because oil is traded in dollars, the weaker pound has reduced the effect of the drop in oil for UK consumers. |
Out of the 124.22 pence average paid for a litre of petrol, about 65% of the price is accounted for by tax, according to analysis by the AA. | Out of the 124.22 pence average paid for a litre of petrol, about 65% of the price is accounted for by tax, according to analysis by the AA. |
As well as being charged Value Added Tax (VAT) at 20%, 57.95 pence per litre is charged in fuel duty. | As well as being charged Value Added Tax (VAT) at 20%, 57.95 pence per litre is charged in fuel duty. |
In September, three major UK supermarkets said they would cut the prices of petrol and diesel. | In September, three major UK supermarkets said they would cut the prices of petrol and diesel. |
Sainsbury's and Tesco both announced a drop of up to five pence per litre, while Asda said it would reduce petrol by up to one penny and diesel by two. | Sainsbury's and Tesco both announced a drop of up to five pence per litre, while Asda said it would reduce petrol by up to one penny and diesel by two. |
The motoring organisations AA and the RAC welcomed the move. | The motoring organisations AA and the RAC welcomed the move. |
However the group representing independent fuel retailers said the announcements would further endanger local petrol stations. | However the group representing independent fuel retailers said the announcements would further endanger local petrol stations. |
In order to see this content you need to have Javascript enabled. Visit BBC Webwise for full instructions. | In order to see this content you need to have Javascript enabled. Visit BBC Webwise for full instructions. |
Is the cost of fuel affecting your driving habits? How much is petrol in your area? Should retailers be made to cut fuel prices? You can email haveyoursay@bbc.co.uk |