It's a puzzle for
anyone used to seeing prices for the various types of energy we use moving
backwards or forwards hand in hand.
The cost of filling
up the car accelerated ahead but now it's gone into reverse. Well, slightly, by 5 and a half pence a litre.
But the gas price
bubble just seems to grow bigger and bigger. More than 8% bigger with British
Gas's latest price increase.
One explanation is
that petrol prices are affected by movements in the dollar/pound exchange rate,
because crude oil and refined petrol are both priced in dollars.
The pound has enjoyed
a significant recovery against the dollar in recent months, jumping from about
$1.50 in value to around $1.60.
So while crude oil
hasn't moved much in world markets, the cost to us in the UK has gone down.
Gas, on the other hand,
is traded in sterling in the UK. There is less of the currency effect.
Not everyone in the
energy market believes there has been enough of a rise to justify the price
increase.
But British Gas says
the cost of getting hold of gas and electricity accounts for a third of the
jump in bills.
Will the petrol drop
compensate for the gas hike?
If you fill up the
car once a week, you are likely to gain more than you lose.
However, occasional
drivers will still have cause to shiver from this week's energy news.
The petrol benefit
will be outweighed by the cost of keeping warm.
Some of your responses on twitter:
Shhh, don't say it out loud or they'll hike the petrol up too!
Lack of gas storage is a partial explanation.
Because #Milliband warned the #energy companies that #Labour would cap their charges, so they're all rushing to the counter now!
real-reason-why-energy-prices-are-spiralling-out-control Basically, the reason is policies intro by @Ed_Miliband that the coalition won't reverse.
Petrol Fuel Duty frozen and petrol co's don't need tens of billions of new investment in plant and distribution.
different raw materials. Duh.
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