Keywords
Citation
Margaroni, D. (1999), "Oil prices", Industrial Lubrication and Tribology, Vol. 51 No. 4. https://doi.org/10.1108/ilt.1999.01851daa.003
Publisher
:Emerald Group Publishing Limited
Copyright © 1999, MCB UP Limited
Oil prices
Oil prices
Keywords Oils
As of March 1999, an unexpected cut of OPEC production by 1.72 million barrels/day with the indication of further cuts brings to mind the old adage ''If one thing is certain about the global energy market, it is that nothing is certain''. Whatever the longer-term prospects are, and there are many who doubt that these cuts will be maintained for any period, the short-term effect upon oil prices has been significant. Whilst whether these higher prices will have time to filter through to the downstream market is questionable, the longer-term significance in terms of lubricant prices and formulation is even more debatable. What has become immediately evident, however, is a sharp increase in prices, particularly diesel fuel, as a result of the last budget, ostensibly an action by Government to improve the quality of our environment. Prices in the UK for both petrol and diesel are now the highest in the world. Despite Government claims that the fuel duty escalator was one of the measures taken to protect the environment, in reality CO2 levels will not be reduced, since large commercial vehicles do not stifle our motorway network and pollute our atmosphere from choice, but from the need to meet market demand. Let us not forget that the massive increase in road haulage traffic was a direct result of the inability of our rail network, for a variety of reasons, to accommodate longer-haul essential supply routes. That market will remain whatever the fuel costs, and margins in the very competitive road haulage industry are already so low that extra fuel costs will be borne directly by the consuming public. The fuel duty escalator is in reality a highly successful means of providing revenue for the Exchequer, and not a serious attempt to influence patterns of conveyance. It is therefore unlikely that the commercial vehicle parc, together with the implications for lubricants types and volumes, will be affected as a result.