Tag Archives | petrol prices

Price of oil vs Price of Petrol in Ireland – a comparison

Here’s an updated version of a graph that I originally put together last year. It shows the movement in the price of Irish unleaded petrol (as per the AA Petrol Price page) vs the price of a barrel of oil (the price of light sweet crude as is always quoted on the news reports when referring to the price of oil).

I’ve been trying to decipher what this chart is actually telling us.

I was originally inspired to rerun this analysis because its obvious that despite the massive fall in the price of a barrel of oil in the past 6 months, we haven’t been seeing similar drops at the petrol pumps. And this graph is showing us that thats the case – the green line for the oil price is below the red line for the petrol price.

Yes, all bad and not very nice for us consumers.

But, as you can see if you look further back in time, when the price of oil was skyrocketing in mid-2008, we were somewhat shielded from the full impact of that – illustrated by the massive gap between the red and green lines during that time.

So, a sort of petrol pricing swings and roundabouts. It looks as if petrol retailers didn’t make as much money as they could have done last year, but are making up for it now.

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Drive prices down – Cut car costs by fuelling around

Irish News of the World

February 1st, 2009

Diarmuid MacShane

Are you being driven around the bend paying more to keep your car on the road, or are you cruising now that it’s costing you a lot less? This week we’ll look at the recent changes in motoring costs, and how to save a few quid here and there.

Petrol and diesel prices have plunged since October from a high of €1.40 per litre to less than €1. But have you noticed that petrol is slowly creeping up again recently, despite the price of oil remaining low? Do garages think that we won’t mind paying a few more cents than we should just to boost their profits because we’ve paid higher in the past?

Buying petrol up North won’t unfortunately save us cash, but you can use the website www.pumps.ie to find out the lowest costs in your area. And remember, if you see cheap petrol somewhere make sure you take advantage by topping up instead of always running to empty and reducing your options to chose the price you pay.

This week we found out that car insurance costs would be going up again. If 2008 was the safest year ever and a recent EU survey found that 8 in 10 Irish people felt safer on the roads, why the price hikes? Are insurance companies’ screwing customers to make up for falling profits because of losses on their stock market investments?

So how can you beat these unfair price rises? Remember that insurance companies depend on most people automatically renewing their car insurance instead of shopping around for better offers first.

Even if you think you don’t have the time it can be well worth your while calling 3 or 4 insurance companies for a quote. A recent Financial Regulator survey found that the same person could get quotes of between €426 and €840 for the same insurance cover. Threaten to leave your current insurer – they may drop their prices to get you to stay.

With car sales stalling during 2008 and already falling 16% in 2009, ValueIreland.com is being told two different stories about the price of cars.

On the one hand, some of our readers are seeing up to €10,000 being knocked of the price of new cars, and some 2nd hand great bargains in garages and at auctions. But on the other hand, some think that garages would rather go out of business than sell a car at a discount.

Because garages now are less likely to accept a trade in because they don’t know what the car might be worth in 6 months time and because they might not be able to shift it, if you are in the market for a new car though, you could try to flog your car yourself.

A new Irish website www.CarForeCourt.ie will let you upload your car details for any interested garage or individual who’s looking for a similar car to come to you. You can also see what cars others have to offer and even potentially see if you could arrange a swap.

And if you want 2 cars, you could always keep an eye out for the “buy one, get one free” that a couple of Irish garages have offered recently, mirroring what’s happening in the US and UK.

With the fall in new and second hand car sales, it might just mean that we’ll be forking out more on servicing, repairs and passing the dreaded NCT just to keep our cars on the road for longer.

However, because garages aren’t selling as many cars, they’ll be keen to get your servicing business instead. With this in mind, you should be able to drive a hard bargain by calling a few garages to see how low they might go. Don’t be afraid to haggle and play one off against the other. Make sure you get a written quotation – it saves any hassles later.

You could get your car serviced at home or at work. There are several Irish companies that will to come to you to service your car. Since their costs are lower, you should be able to get yourself a good deal.

A top money saving tip is to avoid paying for a “pre-NCT” service. Why not just have your NCT done and if you fail, you’ll know exactly what needs to be fixed rather than paying for stuff that might not need to be fixed.

Finally, how about getting your car serviced in Northern Ireland? We’ve been told that you can find significant discounts on servicing in Newry and Belfast. If you plan it right, you can drop your car off in the morning, do your shopping around town, collect your newly serviced car, and set off for home with your northern shopping bargains, saving yourself a bundle on the trip.

Check out these links below for more of the ValueIreland.com Top Tips for Motoring:

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It will save you €1,000’s

Irish News of the World

Sunday January 25th, 2009

Diarmuid MacShane

Save Money. Don’t just “Not Spend”

Some of our biggest monthly expenses have decreased over the past couple of months.

Some people could be up to €200 per month better off because of ECB mortgage rate cuts. Monthly petrol costs have gone down by as much as €60 as well. And many of our shops are cutting prices to try to attract our custom.

What are you doing with the money you’re not spending? Maybe the extra money is just sitting in your bank account, gradually being used up on other expenses?

Or are you making the effort to actually save that money? ValueIreland.com suggests that you set up a separate savings account somewhere (if you don’t already have one) and redirect the money that you’re not spending.

Even better to totally resist the temptation to spend this small monthly bonus, set up a direct debit for the €260 or whatever you’re not spending, and move it to your savings account immediately after you’re paid. Out of sight, out of mind!

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Petrol Price in new Tesco in Cashel, Tipperary

We received this e-mail from a ValueIreland.com reader yesterday:

I live in Cashel Co.Tipperary. Tesco opened a new filling station in Cashel and charge 96.9c per litre for petrol. 14 miles away in Clonmel, Tesco charge 91.9c per litre. To me this is very unfair to Tesco customers in Cashel.

This was my original response:

Unfortunately there’s not a whole lot that can be done in situations like this. We’ve received numerous e-mails about petrol prices in the past – many asking about a “petrol regulator”. There isn’t any such thing, so petrol stations can charge what they want.

I suppose what Tesco are hoping to cash in on is that people will assume (given much press coverage where Tesco is referenced as having cheap petrol) that whatever they’re charging in Cashel will be cheap. As you’ve found, this is obviously not the case.

Do you know what the petrol prices are in surrounding areas in Cashel – is Tesco about the same, or as is normally their ploy to be 1c cheaper than the average? I’m guessing the average price of petrol in Clonmel is about 92.9c on that basis as well.

As it turns out, after doing some quick checking on Pumps.ie, this was exactly the case with regards to the price of petrol in both Cashel and Clonmel.

Tesco are obviously depending on the fact that most people in Cashel probably wouldn’t even know the price of petrol in Clonmel for a start.

The question is though – if you were to shop around for petrol, would you drive the 14 miles from Cashel to Clonmel to save 5c per litre on a price of petrol?

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Top Tips for Irish Consumers from Pumps.ie

With thanks to, and courtesy of Pumps.ie, here are their Top Tips for Irish Consumers, the third installment.

  • Don’t buy things you don’t need. When you are tempted to buy something think of how much space you are going to need to store it, will you have to clean it, do you have something else already that does pretty much the same thing and will you be bored with it in no time? It is amazing how much junk we waste our money and precious storage space on!
  • Learn to differentiate between quality and brand. Many branded goods are expensive but of poor quality and many cheap goods can be of excellent quality. Learn to tell the different between good quality products that will last and give good value for money and low quality branded products that just make you feel good because you recognise the brand.
  • Don’t subscribe to things you will not use. Subscriptions will quietly suck away all of your money while you are not looking. Think of those gym subscriptions and clubs you have joined that seemed like good value if you went 3 times a week but only ended up going twice.
  • Don’t fill the car up with petrol if you don’t need to. Only half fill the tank if you are just making short trips where you frequently pass filling stations. By half filling your tank you are not wasting fuel carrying around un-needed petrol or diesel.
  • Buy a remote control for your TV and DVD plug sockets so that you can turn all the units off with one press of a button rather than letting them drain your electricity on standby. These remote control sockets use much less power than your TV on standby and are available for ?20 to ?30in many hardware stores.
  • Drive at a consistent speed that leaves plenty of room between you and the car in front. Driving at a steady speed is more efficient then constantly breaking and accelerating. If you drive too close to the car in front of you you tend to break and accelerate more as you try and match their speed exactly.
  • Walk around your local area rather than driving, not only do you save money on gym membership and petrol but you also get more of a feel for your local community.
  • Get a pension and put as much into it as possible. It is the most efficient way of avoiding paying tax.
  • Claim all of the tax benefits you are entitled too. This can include health expenses, rental allowances and now even a bike purchase!
  • Shop around for goods, especially commodities like petrol or milk which are almost identical where ever you buy them.

The complete series listing of Top Tips for Irish Consumers is now available here.

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Shopping Around for Petrol

I was always intrigued by the comments of certain commentators to “shop around” when it came to buying petrol. Not that it matters much these days (sort of) given the large price decreases we’ve seen in the past 5-6 weeks, but I thought I’d consider it a little here.

I suppose my skepticism about shopping around for petrol is that it’s kind of hard to do when the red light flashing at you on the dashboard. But there are a few things that you can do to ensure that you take advantage of the cheapest petrol and diesel available.

1. Stay informed – Check out the AA Petrol Prices web page to see what the current average price of petrol and diesel in the country. That sets the benchmark price in your mind. Now you can gauge what’s cheap and what’s dear.

2. Use Petrol Price Comparison Websites – Check out Pumps.ie or BestGarages.ie (no longer active) to find out the reported petrol and diesel prices in your local area. If you use these sites to find out information, make sure you pay it back by providing updates of prices that you’re aware of – sharing the information around makes these sites as useful as possible to everyone.

3. Don’t drive to empty – If you’re driving past a petrol station that has cheap petrol or diesel, but you’re only half empty – go in and fill up. If you know it’s cheap, fill up and take advantage of the price. You might not be back that way again, or if you’re waiting for the red light, you might be too far away to make it back to fill up.
4. Don’t fill up just because you’re empty – If you’re a red light gauge bandit but you get caught short and you end up having to buy petrol at a price you know is too dear, you don’t need to fill your car there. Get a tenners worth and get yourself to somewhere you know is cheaper.

5. Don’t get caught out in the shops – Most garages selling petrol now have swanky new shops and snack food providers associated with them. And given that’s how petrol retailers make most of their money, the prices here can sometimes be over the odds. If you can, avoid buying things in these shops, and you’ll cut the overall cost of your visit to the petrol station.

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Why is the price of petrol falling?

During the late spring and summer of 2008 as petrol prices were rising drastically, we were told various different reasons behind those rises. It was because of the weakness of the dollar, the increase in demand and the approach of peak oil and the impact on supply. Or all of the above, or some of the above.

However, there were strong suspicions that a significant proportion of the rise was due to the market speculation on the part of investment banks, commodity traders and hedge funds. This article (albeit coming from a particular “angle”) cites that 60% of the rises we saw earlier in the year were due to speculation alone.

Not being a financier or an economist, I don’t know myself, and I haven’t seen any specific evidence for any of the arguments.

However, what is very noticeable is that since many of the worlds larger financial institutions have become strapped for cash because of the fallout from the “credit crunch” caused by their exposure to sub-prime mortgages, we’ve seen a significant decline in the price of oil.

In fact, we’ve actually seen a decline of about 60%. Spooky!

Do the oil speculators from late spring and summer now have no more spare cash to play with on the oil commodity markets, and thereby causing the price to drop?

Did they in fact try to manipulate/speculate on the oil commodity markets earlier in the year in an effort to actually bring in some extra cash quickly to cover the hole in their finances that they saw coming because of the sub-prime problems?

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National Consumer Agency starts their petrol price investigation

In case you don’t know, you can be safe in the knowledge that the National Consumer Agency have started their investigation into petrol prices.

The very morning after that investigation was announced, someone from a NCA computer IP address was onto Google searching for “retail petrol prices Ireland”. They’ve been back a few times since.

Let’s hope their researcher took heed of the advice provided in my earlier post on the reasons for the price of petrol at the moment. I wonder did they also hit the sites of Pumps.ie or IrishFuelPrices.com (RIP as they’ll have found out).

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National Consumer Agency to investigate the price of petrol

According to this article in todays Irish Independent, the National Consumer Agency are to investigate why the price of petrol hasn’t decreased in line with the price of a barrel of oil.

Yet again, it’s the NCA and Minister Coughlan jumping on the media generated bandwagon – this time about the price of petrol. We’ve all forgotten about the euro/sterling exchange rate difference, so now it’s on to petrol.

For free and for nothing, I can save them a massive amount of time, and a massive amount of money – let the fuckers* read this blog and my comments on the price of petrol and be done with it.

Just to show you how little these people know what’s going on around them, and seemingly don’t even communicate with each other, according to the article:

Minister Coughlan feels grocery prices have dropped since the NCA’s series of surveys of supermarket prices over the summer.

Yet the most recent NCA survey states:

In general, for Dunnes, Tesco and Superquinn the basket of branded goods has increased from December 2007 to August 2008. However, from June to August the level of the increase has slowed or in some cases decreased.

Hardly a ringing endorsement of their bosses feelings by the NCA.

Maybe we should have the Comptroller and Auditor General, who today released their annual report, carry out a “Value for Money” analysis on the activities of the National Consumer Agency?

Doing surveys and buying baskets of goods doesn’t do anything to bring down prices. All it does is make it look to consumers that the government is doing something about perceived high prices, while in reality they’re doing absolutely nothing. And now they’re going to apply the same logic to doing nothing about the price of petrol.

Pointless.

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Why does petrol and diesel cost so much? (2)

This e-mail came through this evening from a Value Ireland reader:

Just noticed on my way into work this morning that various petrol stations along the Cabinteely-Donnybrook route have increased the price of unleaded by 2c a litre. Considering the cost in $ terms has fallen by 22% since its highs, this should translate into about 1.05 a litre and not 1.28. Any idea why?

While I had posted about this earlier last week, it seems that this topic has come up again in the newspapers this morning following a call from the Consumer Association of Ireland Chief Executive, Dermott Jewell, that the Competition Authority get involved.

From todays Irish Independent, according to Mr. Jewell:

“The extraordinary situation continues,” he said. “The increases were put down to the price of a barrel, and then it was put forward that it was a currency issue. The reasons given are poor. We should be seeing reduced charges at the pumps. “We’ve put this off long enough. We need to have some form of investigation. The Competition Authority needs to urgently demand answers as to why this is the case. We need some intervention. This affects every part of our economy, not just the consumer. This is no more than continuing price taking.”

In short, this is pointless. As consumer’s we’ve shown that we’re willing to pay upwards on 140c per litre earlier this year – why would petrol retailers who are in the petrol selling business to make a profit reduce their prices that far below a level that they realise Irish consumers are grudgingly willing to pay.

It’s tough, I know, but it’s the hard reality of the petrol retail market in Ireland as it stands at the moment. There’s a lot more to illustrate the pointlessness of this suggestion – read on if you want to see more.

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Pointless Exercise

Bringing in the Competition Authority isn’t going to reduce the price of petrol for consumers.- I don’t believe there’s anything for them to investigate. If Mr. Topaz gets up in the morning and looks across the road to see Mr. Esso charging 3c more, and he ups his price by 3c – we end up with petrol uniformly increasing by 3c – but without any price fixing taking place.

As an aside, it’s a similar situation when you look at the recent National Consumer Agency grocery price survey. From a basket of 72 individual items, Dunnes, Tesco and Superquinn have exactly the same price on 41 items – yet there were no price fixing calls following that survey – they just happen to have the same price, apparently.

So what is going to cause the price of petrol to fall?

In short, unless there’s a massive fall off in the demand for petrol when we start using the trains and buses, or the government brings in price controls, the answer is nothing will.

Given that the sale and pricing of petrol in Ireland is a non-regulated market and selling petrol is a business, the petrol retailers will sell petrol at a price that consumers are willing to pay.

Over the summer, when a barrel of oil was touching $145, and a litre of petrol was 10-15c more than it is now, the petrol retailers found that people were still buying as much petrol as always, despite the price rises. Retailers now know we’re willing to pay a whole lot more – so, why would they drop their prices if they can charge more, and get it. Anyone in business would recognise the madness of doing such a thing.

Basically, in economics terminology, the price of petrol is inelastic – when the quantity demanded does not change much with the price change. Petrol retailers have identified that for most car owners, petrol has almost become a non-discretionary purchase – because at least up to a price of 140c per litre, consumers will still keep buying the same amount each week.

So, bring in the Competition Authority?

Presumably, as requested by Mr. Jewell, the Competition Authority could investigate the retail petrol market in Ireland – and therefore determine if we have enough competition.

But they’ve done this investigation already. For an organisation that takes years to produce their research, their 2006 observations following the Topaz/Statoil merger approval fiasco could almost still be described as current. The summary of their investigations back then were that:

Consistent with other decisions, such a market concentration (of a combined Topaz/Statoil market presence) does not give rise to competition concerns at national level.

It could be worse

To further illustrate the pointlessness of any new research completed now is the fact that relatively speaking, Irish consumers are better off now than they theoretically could be.

Even allowing for exchange rate differences, the price of a barrel of oil has increased 32% in the past 2 years since the original Competition Authority statement – but the price of petrol in Ireland has increased by only 20%.

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