Why is petrol still so expensive?
Unfortunately the things we need to live and work are really expensive in the UK. We’re talking about food, energy bills and petrol in the main. Some of the cost with these items is generated by import charges, others by taxes and some by good old supply and demand issues that drive prices skyward. Does any of that explain why petrol’s so expensive in the UK?Price per litre
At its height, drivers in the UK have been asked to pay as much as £1.30 a litre for petrol. We no longer talk about pricing per gallon because that number would be astronomical, and perhaps because of this people no longer think of fuel in terms of gallons. Anyway, the price we pay is often as much as 39% higher than the average price paid across the rest of the world. At the moment the UK ranks as the 19th most expensive country in the world for petrol. So what do other countries pay?
Cheapest countries for petrol
You won’t be surprised to read that most of the cheapest countries for fuel are those who produce the stuff. The Middle-East accounts for 7 of the 10 cheapest nations to fill your tank up in. People in Venezuela pay the least for petrol as they routinely pay the equivalent of 2p per litre. Whenever their government try to increase the cost of petrol the people of the South America country riot.
Why so expensive in the UK?
Well, there are a number of reasons why petrol’s so expensive in Britain. To understand this, you need to break the costs down into 4 categories. Fuel duty makes up a major part of the charge. That’s set at 57.95p per litre. Of course, you also need to account for the cost of the product itself. The cost of crude oil is the second highest portion of the charge we pay at the pump. The third element is another tax. Yes, in the UK we pay VAT on petrol even though the government has already levied a tax. Oh, and the VAT we pay is calculated against not only the cost of the product but against the fuel duty too, so you’re being taxed on your taxed. At the end of all that the retailer still needs a profit margin. This is normally only 5p to 7p per litre.