HC Deb 28 June 1982 vol 26 cc598-9
9. Mr. Walter Johnson

asked the Secretary of State for Energy if he will hold discussions with the oil companies over the fluctuating prices of petrol; and if he will make a statement.

Mr. John Moore

No, Sir. The price of petrol is determined by market conditions.

Mr. Johnson

Is the Minister aware that during the past month petrol prices have increased by 20p, without comment from either the Minister or his Department? Does he realise that an increase of this sort means real hardship to some motorists, to small business men, and to garage proprietors working on a small profit margin? They have seen prices go up and down almost constantly during the past six months, and up 20p in the last month. Does the Minister realise that this pushes up prices in the shops and the cost of living? When will the Department and the Minister do something about it?

Mr. Moore

Nobody fails to understand the problems associated with price increases, but my Department was not asked to comment between November 1981 and March 1982 when pump prices declined by 21 per cent.

Mr. Robert Atkins

What hope does my hon. Friend hold out for those living in rural areas where small garages, suffering as a result of the increases in petrol prices, may go to the wall and thereby take away facilities from those who most need them?

Mr. Moore

My Departemnt has had considerable experience of trying to assist rural garages, but the rural-urban price disparities that exist are essentially a reflection of retail margins. To that extent, petrol is not dissimilar from other products.

Mr. John Evans

Is the Minister aware that, when crude oil prices are falling, the vast majority of British people feel that they are being ripped off by petrol companies which increase prices at the petrol pumps so substantially? Is it not time that his Department intervened to protect the people from something that will increase inflation?

Mr. Moore

I am sure that the hon. Gentleman will be happy to help the British people to understand the truth, which is, as my right hon. Friend the Secretary of State said, that we are paying less in real terms at the pumps than we were in April 1975. It may be of interest to the hon. Gentleman to know that when crude oil prices in 1975 were at $12.50, the equivalent of $18.75 today, they are today at $33.50 a barrel. Difficult problems are always caused to all of us in facing the reality of prices in the market place.

Mr. Merlyn Rees

Given the Secretary of State's belief in the infallibility of free market forces, as expressed in his Hutber lecture, will he explain why, with a decrease in demand, petrol prices go up?

Mr. Moore

This may be a perfect opportunity for me to draw the attention of the House as the right hon.

Gentleman has done, to that excellent lecture, published in full in the Sunday Telegraph. My right hon. Friend, as all who understand markets know, is quite right when he says that the market place will ultimately provide.

Mr. Rees


Mr. Moore

The fluctuations that occur in the interim are associated with declines in prices, but I heard no complaints from the vociferous Labour Front Bench when prices declined.