Thursday, June 18, 2009

September 2009: Fuel protests?

If there is one thing that has been consistent for Gordon Brown throughout his time in Government, both at the Treasury and at Downing Street, it's been fuel protests. Whether it was in 1999/2000, 2005 or in 2007, the issue has been a recurring theme of his tenure over taxation in the United Kingdom.

Of course, Brown has consistently blamed the nasty businesses that sell us fuel. In fact, just over a year ago, when prices were going through the roof he said it was all the forecourts fault. He rarely acknowledges the point that tax makes up around 70p for every £1 spent on fuel.

Funnily enough, this June, like last June, is seeing another rocketing soar in the price of oil and at the forecourt. You'll be lucky to find a petrol station selling at less than 99.9p per litre in fact. It has been steadily rising over the past few weeks and months, up to 1.10p per litre in some of the named brand forecourts. The following graphs illustrate what is happening.... again.

Crude oil price per barrel (BBC Business)

Unleaded petrol price in pence per litre (

So, we're almost half way back to the peak price we hit in July last year. Now, if you're wondering why I'm mentioning this its because, if the upward trend continues, we're going to be hitting crazily high peotrol prices again around the beginning of September and the conference season.

What's more, and this is the kicker. In September, the Treasury will be implementing a 2% increase in fuel duty. This will be followed by a 1% above inflation yearly increase every April, as per the 2009 Budget.

This I would like to pose a question. Who thinks that Brown will force Darling into a yet another U-Turn when the fuel protest groups begin to start campaigning?

Let's consider the fact. Oil prices are rising. Forecourt prices are rising and have breached the £1 per litre mark yet again (that's £4.54 a gallon), and in just over three months the Government will increase the tax by another 2% on the cost as well. It ain't going to be pretty!

Like the issue of the 10p tax rate, Brown will no doubt be totally blind-sided by it aswell. (no joke about only having one eye intended honestly). Mind you here's already being warned in Parliament.

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