The Biden administration has announced the completion of its Strategic Petroleum Reserve (SPR) replenishment after selling a record amount of oil in 2022 to combat rising fuel prices. The administration purchased 2.4 million barrels of oil, bringing the total replenished to 59 million barrels, but the department’s purchasing fund is now depleted. Despite the depletion, the Biden administration highlights the SPR’s role in stabilizing fuel prices and ensuring energy security.
India’s oil marketing companies (OMCs) are expected to see a decline in operating profit in fiscal 2025, driven by factors such as discounts on Russian crude oil and softening diesel spreads. While the profit will be lower than the previous fiscal year, it will still be higher than the historical average, supporting their significant capital expenditure plans. Stable retail fuel prices amid volatile oil prices will play a key role in maintaining the overall returns for the industry.
Argentina’s state-owned energy company, YPF, has announced a reduction in fuel prices across the country, effective October 1, 2024. This move aims to alleviate the burden on consumers and businesses amidst economic challenges, including high inflation and currency instability. While the full benefit of the price cut is partially offset by a recent increase in taxes and the devaluation of the Argentine peso, the reduction is expected to have a positive impact on the economy.
Mahanagar Gas Ltd (MGL) has increased the price of CNG in Mumbai by Rs 1.50 per kg and domestic piped natural gas (PNG) by Re 1 due to rising input costs. The new prices will come into effect from the night of July 8-9. This rise is attributed to increased demand and a shortfall in domestic gas allocation, forcing MGL to source more expensive imported LNG.
The Maharashtra government has announced a reduction in Value-Added Tax (VAT) on fuel in the Mumbai Metropolitan Region, leading to a price decrease for petrol and diesel. The decision, announced during the state budget presentation, is expected to come into effect from July 1st. This move, costing the state ₹200 crore, aims to provide relief to residents and comes ahead of the upcoming state assembly elections. The budget also includes other key announcements like financial assistance for women, farmers, and healthcare improvements.
Senior BJP leader and former MLC MB Bhanuprakash passed away on Monday after suffering a cardiac arrest while leading a protest against rising fuel prices in Shivamogga, Karnataka. He collapsed after addressing party workers and was rushed to a hospital, but could not be saved.
Asda has surpassed Tesco, Morrisons, and Sainsbury’s as the most expensive fuel retailer in the UK. The supermarket giant’s fuel prices are an average of 2.1p higher for petrol and 2.5p higher for diesel compared to its rivals. Asda’s acquisition by the Issa brothers in 2021 and the integration of EG Group’s UK arm may have contributed to this increase. Despite previous commitments to maintain competitive fuel prices, Asda’s target fuel margin has significantly increased since 2019. The Competition and Markets Authority (CMA) is monitoring fuel pricing issues and may take action on pump margins in the future.
Europe is witnessing a significant surge in airline fares as the onset of summer travel coincides with an unprecedented demand for international trips. The spike in airfares is attributed to a post-pandemic surge in travel demand, reduced airline capacity, and economic factors such as rising fuel prices. Popular destinations like Paris, Rome, Barcelona, and London have seen airfare increases of over 30%. Despite the higher costs, travelers remain determined to enjoy their long-awaited vacations, leading to a bustling summer for European airlines.
Fuel prices in Edmonton, Alberta, are experiencing significant variations, with some gas stations charging up to 20 cents per liter less than others. The president of Canadians for Affordable Energy, Dan McTeague, attributes this disparity to the #gasbarshenanigans phenomenon, where gas stations engage in price manipulation to maximize profits.
According to McTeague, the wholesale cost of fuel in Edmonton is approximately 96-97 cents per liter, with additional taxes and fees raising the total replacement cost to around $1.43-$1.44 per liter. Retail gas stations typically operate with a margin of 7-8 cents per liter, allowing them to cover operating costs and credit card fees.
However, some gas stations are selling fuel at prices significantly below this margin, raising concerns about their sustainability. McTeague believes these stations may be relying on additional revenue streams from store sales or other strategies to offset the losses incurred from selling gasoline below cost.
While Calgary also experiences price variations, its fuel prices remain higher than in Edmonton due to transportation costs from refineries. McTeague emphasizes that current gasoline prices are reflective of market trends across the U.S. Midwest and Western Canada.
Consumers are advised to take advantage of lower prices while they last, as such disparities in fuel costs may not be sustainable or long-lasting.
In an effort to combat profiteering and ensure fair pricing for drivers, the government is reportedly finalizing plans to establish a Pumpwatch regulator, which will monitor petrol and diesel prices in real-time. This regulator will give petrol station owners a 30-minute window to adjust their prices accordingly, and failure to comply will result in fines. Howard Cox of FairFuelUK has called for strict financial penalties for firms engaging in profiteering at the expense of motorists. The Pumpwatch website will provide updated pricing information every 30 minutes, fostering competition among petrol stations and aiming to address the ‘postcode lottery’ of forecourt prices that currently exists.
