And then you take your old mate Gus to your rescue. First of all Gus’s opinions are not facts, they are just opinions. There is a big difference.
Yes Gus has a good point in that we should use the diesel price as an indicator. All our basic commodities are very much diesel influenced, especially in a country like Australia with 300 km betweens the pubs. But it is not a new idea. Many economists share his ideas especially those who favors government subsidies in the economy. I do not, but it’s a good idea anyhow.
Then your Mate Guss start to behave like a self appointed priest in a closed community in the mid west of USA
Hallelujah, only I know the path to go, Government and the rest of the Judas’ of the oil companies are only out to rip us off.
I own a small transport company and I have had to significantly raise my prices twice in the past year just to maintain profit margins. This cost you money too. Owning a transport company doesn’t make you an expert of National Fuel Questions, even if you have to increase the prices twice.
I am compelled to write this letter because I am sick of all the namby-pamby pussyfooting around everyone seems to be doing about the current fuel debate. Sorry to ask what does this mean. I have spent considerable time researching this area because it affects my income. Yes this is a good thing but I think the problem is very complex and I think it is difficult for a truck driver to make any big conclusion only by doing some desk research. There are many, much clever people than you and me, doing research for decades.
0Contained herein is the WHOLE truth about the debate, the WHOLE big picture, if you will. NO-ONE till now has had the testicular fortitude to stick their necks out and present the WHOLE argument about just how much we are being RIPPED OFF. If you want the TRUTH and the WHOLE TRUTH read on.
DON’T – Listen to spin doctors from the oil companies. THEY HAVE A VESTED INTREST TO KEEP FUEL PRICES HIGH.
DON’T – Listen to the government – state or federal. THEY HAVE A VESTED INTREST TO KEEP FUEL PRICES HIGH.
DON’T – pay too much attention to news or current affairs programs. THEY HAVE THEIR OWN AGENDAS.
So here we go, how to make fuel cheaper!
So here we go, hallelujah.
FIRSTLY – DISBAND FUEL PARITY
Parity, for those that don’t know, is government sanctioned price fixing (simple as that). Parity allows fuel companies to sell their products for the highest current price they find in the Asia Pacific region. It completely disregards supply and demand economics and eliminates any need for competition amongst them selves.
Without being an expert on oil price setting in Australia I assume that it is a mechanism to set the Australian prices at an international level. Setting the price only based on, Australian supply/demand figures would be dangerous because in the long run Aussis will have the oil also from the international market. Probably Singapore being a key figure in the international market can supply reliable figures for the Asia Pacific Region. No, it does not disregard supply and demand, neither does it eliminate competition. The Singapore spot market for oil is very, very competitive.
Don’t believe me? Just look at the price of Diesel. If you remember growing up when Diesel was always 10-15c p/l cheaper than Petrol you might understand this more.
How can a product that costs far less to produce (partially a by-product of producing Unleaded as well) and a product that Australia uses more of than any other fuel be MORE EXPENSIVE than Unleaded? Simple, ring Singapore, where they don’t use a lot of Diesel and import all their fuel, find out how much it’s selling for there and charge the same here – sound fair? NOT!
Oh, Yes Fair. The price of Diesel have nothing or at least very marginally to do with the local Singapore demand and supply. It is the international demand and supply that is attached to the huge Singaporean Oil Refinery Industry that sets the price and then you have to live with it as the rest of the world. The demand for diesel has increased very much during the last few years, partly because of the increase of diesel passenger cars in the world. So when demand goes up and supply not the price goes up, also in the outback of Australia. Yes, you can call diesel a by-product if you want. It is derived from crude oil at lower temperature than Gasoline. But Diesel Oil is as important as gasoline for the refinery and it has its price tag that changes all the time. If the price of Diesel goes up because of a demand increase the production process changes so that they can “twist” out more diesel from the crude at the cost of Gasoline. That causes the cost of Diesel to rise because that little extra that we “twisted’ out could have been Gasoline. This process of optimizing the production process is an ever ongoing process were all factors have prices and alternative prices. It may be a temporary situation that diesel is more expensive than Gasoline or it may be a stable one.
Anyhow what the price difference was during “the good old days” have nothing to do with the future. Price relations are not stable and fixed by Good, Thanks Good!!!
Any other industry who tried this one would be hauled of to the High Court quick smart and prosecuted for price fixing! Oh but hang on, our government ALLOWS them to do this
No price fixing is totally something else. For ex. When two small transport companies agree on a same fixed price on a route. Sounds familiarly?? I assume the High Court is not the right forum for cases like this and I assume High Court never is quick smart but slow and wise.
NUMBER TWO – BARRELL PRICE
That price the news loves to show us each night is the PREMIUM GRADE crude oil price. Australian oil companies DO NOT buy PREMIUM GRADE crude oil! In fact Australia produces around 70% of its own oil and imports about 30%. The cost of production per litre produced here is cheaper than that of imported fuel, but in no way is this factored into the pump price, because they don’t need to (SEE PARITY ABOVE) we pay a pump price based on PREMIUM GRADE crude oil price the same as if we imported all of it, say somewhere like Singapore! Starting to get the picture?
Oh Yes I Got the Picture. You want to turn Australia into a subvention based protective country. Because Australia can produce probably all raw materials cheaper than any other country except Russia all these base raw materials must be sold in Australia at a cheaper price based on production cost. This will lead to cheaper food and everything else where raw materials are dominant. The surplus what we not need we export to other countries preferable on barter trade, for ex we sell copper to Cuba and get sugar instead. All trade connections and raw material companies will be taken over by Government in order to prevent private companies to export Australia’s cheap raw materials at a huge profit. All cultural and sports connections are handled by Government agencies who recommend us to quite the World Cup Fotball events and concentrate our efforts on our two Main Series. One professional were everything to stimulate your body is allowed (we could import some of the last, still living DDR Sport Doctors) and one more amateur series. In cricket we are only left with one annual Test Cricket Contest against Zimbawe the game being overseen by MR. Mugabe in person. Mr Mugabe is the guarantee for a Fair Game. Our oil import is handled by Iran and Venezuela and we barter trade the oil against uran. The manufacturing of trucks in Australia changes also radically after the withdrawal of US-Swedish expertise. The manufacturing is now overseen by experts from the Russian Truck Company Kamaz, Their first step was to unify the colors scheme since it is much cheaper to manufacture only one color. Grey was chosen for the next decennium. Also the Trucking industry changed. All routes were overtaken by a party controlled kolhos. The routes were then awarded according to how long the drivers have had a party book. The cars were government owned and all were grey…. Is that really what you want???
While others former socialist countries are striving to get rid of all subventions you want to reintroduce them into Australia to help truckers help their customers….The Soviet Union tried it for 50 years now we know the result…
NUMBER THREE – LEVIES
Everyone knows that both State and Federal Governments take a large slice of the cost of a litre of fuel. This equates in total to about 46% of the price per litre.
Here you have a point if this is correct. In most country the tax (or taxes) are at least partly percentage taxes and this is a thing that should be changed into an inflation corrected lump sum tax (flat rate tied to the GDP) A change to this as such would of course not cause the fuel price to go down as you say. It will work only when prices goes up (or down and consumer looses) Anyhow I don’t think you can find any Government that is happy when oil prices go up. The other effects are causing much more pain for the Government than the increased gas tax revenues brings joy.
NUMBER FOUR – GST - THE DOUBLE DIPP
Here again you may have a point but not a “new” one. It has been discussed in academic circles (maybe you missed it when you made your desk research) of the morality of tax to tax, especially when it comes to sales taxes. The problem is partially avoided when you have a value added sales tax system. Since most advanced countries have it I assume that Australia have it also. So when you pay the gasoline, you actually only pay the sales tax on the profit the gasoline man made on your sales. And so it goes all the way down the distribution chain, everybody only paying sales tax on the “value” or “profit” incurred by each stage of the distribution chain. For you to easier understand your receipt should say: Paid for products 100c, Paid retailers profit 10c, Paid tax 0,9c Total 110,9c
If You have a straight sales tax in Australia the problem is a little different but your “ideas” don’t add anything new. By lowering the sales tax, diesel prices goes down. Correct.
You do the math.
Yes you do your math. Some place you have 9% tax some place 10%. Why should the GST be 5,4% no verbal or mathematical argument. Yes lowering sales tax will lower diesel price. Is this your message , is this Your Whole TRUTH?
And Ian what was your message except that everything is Shit.
HIKO
