Petrol price - the pin to pop the bubble?

Yes. But remember that to compare with different countries you need to be aware of the differing levels of taxation eg UK 95 octane unleaded is taxed at 300%.

Useful weekly comparisons from the European Oil Commission -

Daytona

Historically it has been as a result of raised interest rates and a slowing of the economy. Don' forget that this was in the boom bust days and I would include Nigel Lawson here who fudged the economy just before an election just like Gordon Brown is doing now. Just look at his spending plans and his budget deficit! The only difference now is that interest rates changes are anticipated and also fairly modest.

Big oil price shocks have preceded recessions in recent times.

Neb

The stock market is at about 65% of what it was a few years ago, pensions are in crisis, graduates are broke, noone without a property can afford to buy one as they are so over priced, and consumer debt is over one trillion pounds.

And these aren't boom bust days??? :-)

Not likely, even if oil prices double you will only see a 25% rise at the pumps, as its mainly tax ~75% So even the recent 40%ish rise has only put about 8p on a litre.

Chicken feed really.

I hear Yanks grumbling on yahoo thats its $2 a gallon, thats about 1.20. I think we last paid that in the 1970's?

snip>>>>

Early eighties I would imagine. I passed my test and bought my first car in late 1979. At that point petrol had just passed 1.00 per gallon. (to a lot of public doom and gloom)

Neb

I recall at that time there was an article saying that methanol would become a competitive fuel when the price got to 1.50. I probably read that in the Sun!

I spoke with a friend in California last night (A high fuel tax state) and he said "gas" was $2.60 per gallon. I calculate that to be about

It's all relative. If you do alot of milage, and are used to sub $2 a gallon fuel, and have a gas guzzling SUV, then that extra cost starts to bite.

Aris

I think the direct effect on us will be minimal at these rates - a prolonged rise in oil prices could push the US into recession and that would impact on our economy. The high petrol taxes mean that our economy is less sensitive to petrol increases than the US (and generally we are more efficient in our oil use).

Thom

One of the US environmental groups produced an ad campaign that pointed out that if everyone with an SUV switched to a more efficient car the US would no longer be reliant on middle eastern oil. All the major US networks reportedly refused to air the campaign.

Thom

Now there's a nice urban myth! I suspect that neither premise is true.

Bitstring , from the wonderful person half_pint said

It is on Petrol, however if the same 8p shows up on heating oil (which has 5% VAT and no fuel duty) it amounts to a 50% rise, and will be yet another blow for those of us out in the sticks (no natural gas available).

They are arrogantly saying they will not postpone the petrol tax increase.

But the higher crude oil price goes directly into Treasury coffers.

They are taxing us twice. And laughing all the way to the Bank of England.

Just got backfrom America and spoke to quite a few people about the fuel prce crisis. Lots of interviews about what increase it may take to downgrade their vehicles because of the spiraling fuel price. Most said it would take the price to go to at least $3 a gallon before they considered any different. I filled up an empty tank to bulging for the princely sum of $20.

Of course they loved Mr Blair as well so I tried to inform them of the cost of our fuel more like $7 which they could not comprehend.

Where do you get $7 from? At current prices and exchange rate it is more like $5.75.

Remember, a US gallon is 3.74 litres, and an Imperial gallon is 4.5 litres.

Anyhow, ask the yank how much he pays for health insurance. Ok, the NHS isn't perfect, but it is better than nothing.

Aris

Indeed. Petrol has 50.19p per litre of excise duty - and then on top of that we pay 17.5% VAT on the full selling price. So basically we're paying tax on tax. Somehow this seems wrong to me.

Aris

No better or worse than paying tax on NI, I suppose.

Time to get a less wasteful vehicle then, and stop consuming the worlds resources like there is no tomorrow, would have been my response.

The US political system is so corrupted by big money from business that does not surprise me at all. It is unreal how money controls the media in the USA. And the pot points the finger at kettle's of Saddam and Mislosovich?