Forum Topic

Competition law suspended to boost fuel supply

I really do not understand this.  Why suspend competition law?I was not aware that competition was at the root of the shortage or interruption of supplies!

Ivonne Holliday ● 1357d6 Comments

Why suspend competition law? - Panic, pure and simple: there is an army adage which reads "Do something even if its wrong" and by god don't our incompetent rag-tag of a government get it wrong ever so often.

Clifford Cowell ● 1357d

There are very long queues of stationary traffic wherever there are petrol stations - with their engines running.  You couldn't make it up.

Philippa Bond ● 1357d

Very eloquently put, Mr W!

Michael Ixer ● 1357d

For the principle of supply and demand to apply, suppliers need to be able to increase supply when faced with increased demand. In this situation they can't, because they don't have any more drivers.Just at the moment filling stations can charge pretty much what they like as there is not enough fuel to go round all the people who want to buy it (not enough at the filling stations that is; there is plenty spare at the refineries).So allowing suppliers to collude will make little difference to the consumer, who has already been shafted.

Michael Winstanley ● 1357d

Thank you Michael and I agreed. Is that not cooperation between oil companies?  So, in other words, individual petrol stations (or oil companies?) can set the prices they wish?I understand the principle of supply and demand (and this is exploited many times), but then if there is price competition it could probably mean that consumers will be affected (severely)?  Or the opportunity to overcharge for petrol (by petrol stations or oil companies) is now wide open?  It sounds suspect to me.

Ivonne Holliday ● 1357d

Competition laws restrict what oil companies can discuss. This allows then to liaise regarding, say,  delivery schedules so, for example, Shell could agree to deliver to Wandsworth Town and BP to Putney.  Normally that would be considered anti competitive as there would be no price competition in either location. (Sorry, simplistic example.)

Michael Ixer ● 1357d