Asda announce fuel cap

TrixiBuG

TrixiBuG

TrixiBuG

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Just spotted a link to this article on Facebook (not a facebook link btw :))

From tomorrow (Tuesday September 25) drivers filling up at any of our 203 forecourts across the country will pay no more than 135.7p per litre for unleaded and 139.7p per litre for diesel
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The Tesco near me (this morning) was charging 138.9 per litre for Unleaded, so this is really good news for me as the closest Asda fuel station is only a mile down the road.

It made me wonder though...if Asda can do it, why cant the government?
 
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Doesn't say in the article (unfortunately) so indefinitely? Ie they will always be 3p cheaper maybe

Edit: looks like they are going to have the max charge level in place from now on:

We’re the only supermarket that sets a maximum national fuel price cap for customers wherever they live. That policy is what lies behind the AA’s confirmation that towns with an Asda are likely to have Britain’s lowest petrol prices.
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trixilux said:
It made me wonder though...if Asda can do it, why cant the government?
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You do realise that the government doesn't sell fuel right? They just take a slice of the cost in tax? The slice of tax is static day to day, the actual cost of the fuel is up and down like a yo-yo. If Asda want to sell it for less than it costs them to buy it that's up to them...
 
Muffin` said:
You do realise that the government doesn't sell fuel right? They just take a slice of the cost in tax? The slice of tax is static day to day, the actual cost of the fuel is up and down like a yo-yo. If Asda want to sell it for less than it costs them to buy it that's up to them...
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I thought that the slice of tax that the government applies to the cost of the fuel is what makes up most of the cost per litre...I am sure I saw that somewhere

To GOOGLE!

Edit: Okay found it. So for a litre of unleaded fuel at 132.9p the cost breakdown is:

Fuel Duty: 57.95p
Product: 47.8p
VAT: 22.15p
Retailer/Delivery: 5p

(Explanations of each of these charges found in the
Fuel Duty

In the UK we apply a fuel duty which is essentially an additional tax that is added to the price of petrol before it is sold. This duty extends to all Hydrocarbon fuels such as petrol, diesel, biodiesel and LPG’s that are sold for use in cars and makes up a significant proportion of the price we pay for fuel.

As this duty is applied to the price of fuel before VAT, any change to the level of duty will also have an affect on the amount of VAT you pay. When the government announced it’s budget this year (March 2011) the rate of fuel duty was reduced by 1p to try and stabilise the price of fuel which is 5p less than it would have been with inflation plus the planned 1p rise. To compensate for the reduced duty rate the government has increased the tax for oil companies by up to as much as 32%.
Product

The second largest portion of the cost of fuel goes to the companies who supply the crude oil and those who refine it into fuel products like petrol and diesel. Incidentally the cost of refining diesel is substantially higher than that of petrol which, along with VAT makes the price you pay for diesel higher.
VAT

The petrol you buy at the pumps is subject to VAT which is another addition to the cost of all consumer fuels. The introduction of a new VAT rate of 20% at the start of 2011 saw the price of petrol rise further still.
Retailer/Delivery

If you always thought the high prices you pay at the pumps were down to the high markup added on by the greedy petrol stations you might be surprised to learn that in fact the retailers’ slice of the price of petrol is the smallest of all.

The reason for their low percentage because there is little room for margins as the price of fuel is already so expensive before it reaches the retailer. The competitive nature of the petrol stations to have the lowest price is also an important factor in the money they make from the price of a litre.
)

So a HUGE chunk of the money we pay for fuel goes back to the government, not the oil companies (the Product) or the supplier/ retailer...in fact the government gets 2 lots of payments with the duty and the VAT...
 
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trixilux said:
I thought that the slice of tax that the government applies to the cost of the fuel is what makes up most of the cost per litre...I am sure I saw that somewhere

To GOOGLE!
Click to expand...

Yes it does but to say 'Why can't the government do what Asda do' makes you look a bit special. :p

Government has to pay for public services, fuel is a massive cash cow, if they lower taxation they have to find the money from elsewhere or they have to spend less money.
 
Theophany said:
What's to say they don't raise the cap every couple of months? (Can't read Facebook, at work).
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Here's what thay said:

Here’s some good news for hard-pressed motorists – we’re cutting the price of fuel by up to 3p per litre.

From tomorrow (Tuesday September 25) drivers filling up at any of our 203 forecourts across the country will pay no more than 135.7p per litre for unleaded and 139.7p per litre for diesel.

We’re passing on a reduction in the wholesale price of fuel as part of our commitment to everyday low prices – no coupons, no gimmicks!

Petrol trading director Andy Peake said: "We always aim to be the first retailer in each part of the country to drop prices when costs are falling and the last to put them up.

“And when we do drop prices, we drop them everywhere, setting a maximum national price cap for our customers, which means they all benefit from our low prices, regardless of where they live.”

The reduction comes hot on the heels of the launch of our new smartphone fuel price checker. If you’ve got an Android phone you can now use our app to check out our fuel prices wherever you are – handy if you’re about to fill up somewhere more expensive! The service will be available for iPhone users soon.

You can also check on fuel prices by using our petrol price comparison site, which is powered by independent price checker www.petrolprices.com.

We’re the only supermarket that sets a maximum national fuel price cap for customers wherever they live. That policy is what lies behind the AA’s confirmation that towns with an Asda are likely to have Britain’s lowest petrol prices.

Since 2008 our Income Tracker research has shown that high fuel prices have had a big impact on the average family’s budget. The latest report, released today, shows that although petrol and diesel prices are slightly down on last year costs at the pump rose in August 2012 by more than they did in August 2011, putting upward pressure on the inflation rate and putting further pressure on family spending power.
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Muffin` said:
Yes it does but to say 'Why can't the government do what Asda do' makes you look a bit special. :p

Government has to pay for public services, fuel is a massive cash cow, if they lower taxation they have to find the money from elsewhere or they have to spend less money.
Click to expand...

And yes I agree with you, but in my post edit you can see that out of 132.9 per litre of fuel, Asda only get 5p...where as the Fuel Duty is 57.95p and then you have VAT at 22.15p.

So the government cant reduce the fuel duty If Asda are effectively only making 2p per litre now?

Oh here is where I am taking my numbers from if anyone wanted to know
 
A cap, but for how long?

I have seen this before, I remember when Sainsburys was 134.9 for diesel a month or two ago :(

Most of the garages around here now are already at 143.9, or 147.9
 
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