§ r. David Howellasked the Secretary of State for Energy what studies his Department has made of the contribution which higher receipts to crude oil producers, consequent upon the rise in the United States dollar—pound sterling exchange rate, can now make towards stabilising or reducing petrol prices to the consumer.
§ Mr. Buchanan-SmithOil is traded world-wide; its price is determined by the balance of market supply and demand. Over the past year this has led to some fall in the dollar price of crude oil. Petrol is also a freely traded commodity, subject to competitive forces, overseas and in the United Kingdom, which have led to increases in sterling prices in recent months. Prices of crude oil and petrol can only be related to each other through trade and competition.
§ r. David Howellasked the Secretary of State for Energy what studies his Department has made of the movements in petrol prices over the last six months; and what estimates he has made on the impact of movements in the United States dollar—pound sterling exchange rate on retail petrol and diesel prices.
§ Mr. Buchanan-SmithPetrol prices in the United Kingdom rose by 15 pence per gallon (8 per cent.) on average over the six months to mid March. During the same period the dollar rose by 16.5 per cent. against sterling. The exchange rate is only one of many influences bearing on the process of competition which determines petrol prices in the United Kingdom.