http://news.sky.com/skynews/Home/Busine ... 6140?f=rss



'Make my day, oik!' - George Osbourne

Petrol prices could soar to £2 a litre if George Osborne is allowed anywhere near the 2011 budget more like.

Why is Alan Duncan scare-mongering? I get the feeling the government's about to announce something horrible and this is a distraction to outrage the motorist.

Mmm, he also went to that nice Mr Murdoch to publicise it...

anyone notice the baby sized teaspoon hanging off the pump in that pic

So we'll be relieved when it only rises to £1.75 a litre?

What's scary is that they'll get away with this, and most of us will just sigh and get on with it.
What we need is cars that'll run on milk, it's far cheaper. At this rate, the cost of converting my car to LPG (with every third/fourth run being petrol), I'll see the cost of the conversion back even sooner.

IF you want to get really freaked out have a read of some of the comments on the article.

This has nothing to do with the Government - the issue is getting crude oil from countries like LIbya.

It's not just a matter of getting oil - Saudi Arabia could theoretically make up the shortfall, but the crude from Saudi is "heavy", and needs more refining to make petrol and diesel, and not all refineries can do that. Libyan crude is "light, sweet", - it contains more of the lighter hydrocarbons that make it much easier to refine and you get more petrol/diesel from it.

So, if you want to blame the Government, go ahead. If anything, they'll probably leave duty as it is, as rising crude prices are beyond their control.

The government do have some responsibility for the price of petrol. The post Christmas VAT and duty rises for a start.

Yes, the bulk of the increase in the cost of fuel at the moment is being driven by the rising cost of crude but the tax regime applied also plays a big part in the cost. Admittedly, although it galls me to say so, the current government can't be blamed for the vast bulk of the tax levied they equally have thus far not done much to mitigate the problem. It isn't in their immediate interest to do so after all.

Osborne and Cameron have both stated that they understand the public anger over the cost of fuel but whether they will actually do much about it is a different question all together.

How could Labour possibly react? If he cuts duty (which he'll have to if prices keep going up), it will mean less tax money and more cuts. Since labour want less cuts, how could they argue against letting prices rise?

You could argue the opposite - more fuel duty means higher fuel prices, which has a knock-on effect on economic activity, leading to less tax revenue.

It looks to me like Duncan's 'speculation' is part of a much bigger push:

http://news.sky.com/skynews/Home/UK-New ... 6485?f=rss

And a currently unrealistic one at that, especially since they seem to be trying to prop George up too... 'You'll be a knight in shining armour, George!':

http://www.bbc.co.uk/news/uk-12653686

Firstly, the government is responsible for the majority of the fuel price.

Secondly, Alan Duncan is pushing some sort of doomsday scenario which is highly unlikely.

Thirdly, The Saudi's have already countered for the shortfall in Libya's oil supply, not that they were a major supplier of oil anyway.

The danger here is if Saudi Arabia kicks off like Tunisia, Egypt, Yemen, Jordan, Libya...

It rather looks as if the Saudi elites are getting a little worried, judging by the news reports of the military being mobilised.

If there was no tax on petrol, a litre would cost you 50p.

We pay fuel duty, plus VAT. The VAT calculation includes the fuel duty (which, rightly, it shouldn’t).