What Goes Up Might Come Down

The price of Brent Crude is tumbling. We should be celebrating, no? I for one shall not be digging about in the garage for my spare jerry cans to fill up on cheap fuel down at my local forecourt. Why? Because the price hasn't changed.

It will have come as a surprise to nobody that finally both Ofgem and the Federation Internationale d'Automobile have both this year investigated the prices charged by fuel suppliers compared to the price of their raw product, with the latter writing to the EU to complain in June.

Ofgem recently announced that for the first time it has evidence that energy companies are hiking their prices faster when costs have risen than they lowered them when costs fell. Wow. Who knew? It does make one wonder what Ofgem do with the rest of their days.

The two most obvious industries whose profits depend on the rise and fall of crude oil are our energy providers and our fuel providers; in many cases much of a muchness. It would take an averagely computer-literate ten year old to find a graph depicting the rise and fall of say, Brent Crude and the prices on the forecourts for the last few years. I borrowed such a ten year old and he found me these: petrol (here) oil (here). Fear not, I have returned him.

Raw product (oil) accounts for only about 1/3 of our pump price. We have the Government to thank for about 65% in tax (is there an easier way to collect tax?), a percent or two to the retailer and the remainder to the refiner. Numbers vary by business model, but it's around there.

The peaks and troughs of the price graphs certainly roughly marry up in shape, but do they in size? You may remember everyone crying when petrol went through £1 a litre in late 2007. Crude oil was at about 80 dollars a barrel. It peaked in mid 2008 at just shy of 147 dollars when petrol prices were about £1.20. Then when crude oil fell to sub 40 dollars a barrel the motorist had brief respite at just below the £1 mark again, when ratios would have had it nearer 70p. Recently we've been up in the 125 dollars a barrel region and the average forecourt price has been over £1.40 or thereabouts.

Now we have an oil price approaching the 100 dollar mark, so we can safely assume the price should be tumbling with it. Now whenever there is a price rise in oil, it gets passed on essentially instantaneously, yet when there is a drop we hear excuses. I'm sure companies do hedge on prices and buy in advance, so if there is a sharp drop they will be selling petrol or energy fuelled by more expensive oil they bought before the drop. However, by that model when prices of oil rise there should be stockpiles of cheaper oil to keep prices lower. But you and I know it doesn't work that way.

Price of unleaded at the recent peak at my local BP when oil was 126 dollars? 136.9p per litre. Price last week with an oil price of 105 dollars? 136.9p per litre. But we're all British so we bend over and take it without so much as a trembling of the lower lip. You wonder what the point is of having an Ombudsman who can stare such sharp dealing in the face and ignore it day in, day out. It's enough to make you want to take the train, if it wasn't so crap and expensive too... 

Huhne's Been a Naughty Boy Then? And Other Assorted Stories...

Right then, still no time to post properly so I'll do a quick run through of a couple of items in the news at the moment...

I can't help but be very amused at Chris Huhne's situation. Not because I think he's getting what he deserves because he may or may not have broken the law, but because he has been desperately irritating of late and on an unrelated point, has Lego hair. His grandstanding over the AV referendum and attempt to paint himself as the Liberal attack dog have irked me. I'm not sure what a liberal attack dog looks like, presumably something along the lines of a really quite miffed chihuahua.

One can understand his not wanting to get banned from driving, and the fact that one could find oneself in such a position after 4 relatively minor offences in 3 years (35 mph or that marginal 'is it amber or will it turn red exactly as I cross the line?' aren't desperately criminal) is risible. Still, rules are rules, and nor hell a fury like a woman scorn'd.

The next barking bit in the media has been the 'sack Ken Clarke bandwagon', as driven by the press and jumped onto by Ed Miniband (as sure a sign as there is that you are on the wrong vehicle going the wrong way). I can only assume there was no real news over the last day or two - no brutal suppression of popular uprisings around the world to report on. Now his words weren't ideally chosen but any fool could see he wasn't saying some rape isn't "serious". He was simply pointing out that there are different levels of the crime as defined in UK law, for which there are indeed already varying scales.

Whilst accepting that all forms are of course wrong, stating that a brutal and violent rape with a weapon should be regarded as more serious than that of a non violent rape, or further statutory rape seems only logical. It is not condoning one type or diminishing its impact or importance, but applying the rule of proportionality to different crimes as is done every day by our courts. That we can all get so het up over an unfortunate choice of words that did not represent best what everyone knew to be the essence of what was being said, rather than actually debate real topics is rather disappointing. Not surprising though.

I can't say I'm wild about enshrining into law a mandatory percentage of the budget to give in aid. Whilst accepting that as Dave says, we have a duty to the poorer nations even when struggling ourselves, there should be the ability to keep more money in the leaner times like any household would do. It isn't punishing poor countries to reduce aid in straightened times - it's charity, sometimes you can't afford to be as generous but it is all still giving.

There seems to be a rush not just to sign up to every good cause on the planet (think global carbon emissions) but also to volunteer to fine ourselves or lay ourselves open to prosecution for falling short. I get that proponents will say 'if it isn't law, there's nothing to stop them going back on their promises'. It is just that they are wrong. They are called elections. The other point on our aid programme, as I have made before (here), is we aren't too great at picking out who to give money to and how it gets spent (China, India).

So, more to come when I have a moment. MPs and their expenses are on the way and I think I shall have to drop some injunction-based gags into my human rights piece before it sees the light of day, but we're nearly there. For now though, that's all folks.

And start using my voting buttons below. It makes me think you care. It's like having friends. I imagine.

Driven to Distraction

A sad piece from the news last week - a little girl died in an RTA in Bolton after the driver (her father) followed incorrect directions from his sat nav. Now I'll skip gently round this one, because whilst it serves to highlight a point I wish to make, a little sensitivity is probably the order of the day. The driver, a learner, took an illegal right turn when prompted to do so by his sat nav system. He collided with an oncoming car to fatal ends. The illegality of such a right turn was signposted, but neither the driver nor his wife saw the signs.

There are a couple of points here. The first: an extract from the article concerned states "a recent survey found they [sat navs] had been blamed for causing around 300,000 people to crash in Britain." No they didn't. Drivers cause accidents in the vast majority of cases. Duff information from a sat nav doesn't help, but they don't make the decisions. If the chap in the street I ask for directions tells me to drive into a brick wall, down the side of a ravine or along the London to Brighton high speed line, I will probably thank him and then work it out myself (after out of sight so he doesn't know I'm ignoring him - I don't want to be rude, I'm English). You may be wondering why I would ever ask directions, being a man and all. Surely I either have a cast iron sense of direction or a cast iron stubbornness, either of which makes this direction-asking episode a figment of my imagination? I have a mix of the two. And a map. And a sat nav, but like all of us could be a much better driver.

The point is, you can't go around believing everything you are told, and the advice of sat navs is no exception to the rule. Some are better than others. Some are out of date. The same is true of maps, of the advice of locals and of the navigational directions coming from the array of back-seat drivers in your car. Ultimately though, you drive the car. You are operating a very heavy, very fast, very dangerous machine. So, have your maps and advice and up-to-date sat navs, but ultimately, look out of the window at the signs.

The second point is somewhat linked to this first, but is very specific to the case in question. Why was a learner driver using a sat nav? Now many if not most cars seem to have them these days, but having the voice of John Cleese (well he's got to pay for his divorce settlement somehow) telling you where to go does not absolve you of the responsibility for operating your vehicle safely and within the law. I would suggest basic navigation is a pretty important part of learning to drive, as is keeping your eyes out of the car not glued to a mini tv. By all means get sat nav once you've learned to drive, but if you don't teach a new driver the underlying skills, what chance have they of negotiating the roads safely if technology fails? Which it does. Regularly. Good to see, therefore, the Government introducing navigation into driving tests, but you probably still shouldn't use them whilst learning.

So that's it really. A defence of sat navs. They're pretty good. Like maps. But they don't drive the car. The sooner we stop blaming inanimate objects for the flaws of humans, we might get back to the basics of driving and do something positive for road safety. A sad lesson learned the very hardest way, but one that someone might at least learn something from.