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Cynicism behind soaring fuel prices; DAILY POST OUR VIEW.

YOU cannot fool everyone all of the time, as the saying goes. Why, may we ask, is the price of fuel at the pumps rocketing at the first sniff of trouble in oil-producing countries? Remember what we are always told when the wholesale price of a barrel of oil falls. After a sharp intake of breath, the response is always the same - we can't cut the price charged to motorists because of the time-lag involved.

Where is the time-lag here? Why have prices risen immediately? If our cars are still being driven on fuel delivered long before the trouble in North Africa began, surely the price should not have moved an inch? The cost of petrol and worse still, diesel has now reached frighteningly high levels - up to 140p a litre seen at an independent garage near Newborough on Anglesey yesterday.

And why is it that the price varies markedly from one place to another when the price of, for instance, a packet of biscuits will be more or less the same wherever you go? We can guess the answer: a profiteering and a cynical attempt by the big guns to kill off the independent petrol retailers.

It's easy to see how it works: undercut the private garage owner on the high street, then once you've managed to put him out of business, jack your prices up to higher than he was charging.

Independents such as the one near Newborough have good reason for asking a few pence extra - it is the only way they can make any return. Many have already decided it is no longer worth the bother.

It is particularly galling that the Government, despite all the talk of taking less tax to take the sting out of soaring prices, will shortly be adding an extra penny above the rate of inflation to fuel duty.

Whatever the cause for it, the sharply rising cost of driving will send inflation ever higher, which will push interest rates up. This could trigger an economic crisis not seen since the three-day week of the 1970s. Businesses stand to be hammered twice: for the fuel they use and the higher interest on loans they will pay. It hardly needs saying that this recession is far from over.
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Publication:Daily Post (Liverpool, England)
Article Type:Editorial
Date:Mar 1, 2011
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