UK fuel giants Shell and BP have become the latest petrol forecourt retailers to cut their prices in the UK in response to falling international crude prices.
According to reports, Shell and BP, two of the largest fuel retailers in the British Isles, are to reduce their prices over the next few days in response to a decrease in the cost of crude and rivals cutting their own pump charges.
As recently as a week ago the UK was fearing another fuel crisis and resultant spiraling pump prices as fuel tax protestors threatened a swathe of demonstrations. Fear that fuel depots were to be blockaded causing major shortages resulted in panic buying on Monday and Tuesday of last week. However, concerns proved to be inflated as the protests largely fell flat and shortages were minimal.
Ironically, improving conditions in the international oil market resulted in reductions in the cost crude just days after the troubles. The knock on effect on retail petrol prices had started to take effect by Friday as supermarket sector leaders Tesco and Asda both announced up to 4 pence reductions in their fuel prices.
Oil heavyweights Shell and BP are now set to follow the supermarkets’ lead by matching their price reductions which, on average, will take UK prices back below 90 pence a liter.
UK finance minister Gordon Brown welcomed the new price trend. The chancellor had come in for severe criticism at the height of tensions last week after he refused to take any action to reduce costs at the pump. However some industry onlookers have suggested that the speed at which UK retailers have dropped their prices is because Mr Brown has privately threatened windfall taxes on those that did not.