Weekly News Review - 6th October 2023

Petrol prices rise for fourth month in a row

Petrol prices in the UK have risen for the fourth consecutive month with an average increase of 4.5p a litre in September. The price of unleaded went up from around 152p to 157p whereas the price of diesel rose from 154p to 163p, an increase of more than 8p a litre.

This has led to criticism from motoring groups who have accused retailers of charging “unjustifiably” high petrol prices. It now costs more than £86 to fill up a 55-litre family car with petrol and almost £90 for a similar sized diesel car. This is despite an investigation by the Competition and Markets Authority (CMA) in July which found that drivers were paying more for petrol and diesel because of “weakened” competition.

Analysis from RAC suggests that petrol was “overpriced by about 7p a litre”. Simon Williams, RAC spokesman, said: “In the last two weeks the wholesale cost of diesel has become 10p a litre more expensive than petrol, yet the gap at the pumps is only 5p. If retailers as a whole were playing fair with drivers, petrol would be at least 7p cheaper than it is now, down to about 150p from its current average of 157p.”

Brent oil prices have steadily increased over recent months following a series of production cuts from Saudi Arabia and Russia which has restricted global supply. Prices peaked at $97.27/bbl last week which is the highest level since last November. Brent oil prices have decreased this week to $85.27/bbl, however this is not expected to filter through to forecourts unless there is a sustained fall in prices.

Russ Mould, investment director at AJ Bell, shared his view on the correlation between prices at the pumps and crude markets: “We do not put crude oil in our cars, we put it in refined products – diesel and petrol. This means that changes at the pumps reflect not just the price of oil but the cost of refining and then moving the refined products to their final destination.”

“There is then also the issue – recently addressed by the government – of competition at the pumps, something the public may feel is lacking sometimes. The announcement back in July that retailers will have to provide a live feed tracker for petrol and diesel was designed to address this issue.”

Six companies through to next stage of nuclear technology competition

The government has selected six companies to progress through to the next stage of a competition to design the next generation of nuclear reactors. EDF, GE-Hitachi Nuclear Energy International LLC, Holtec Britain Limited, NuScale Power, Rolls Royce SMR and Westinghouse Electric Company UK Limited have all had their Small Modular Reactor (SMR) designs chosen.

The SMR competition is part of the government’s plan to revitalise nuclear power in the UK which aims to deliver cleaner, cheaper energy and greater energy security. The government have set a target to generate up to a quarter of all UK electricity from nuclear power by 2050. SMRs are smaller than conventional nuclear reactors and could transform how power stations are built by making construction faster and less expensive.

Minister for Nuclear and Networks Andrew Bowie said: “This programme provides the blueprint for how the government can work together with industry to grow the economy and set the future of new, exciting nuclear technologies. I am delighted today we have taken the next step in our plans to unleash a new generation of nuclear technology, boost our energy security and deliver our net zero ambitions.”

Gwen Parry-Jones, CEO of Great British Nuclear said: “Today’s announcement is a key step forward in delivering the government’s objective of boosting nuclear power in this country. Our priority in this process has been to prioritise reliable and sustainable power to the grid early, and that’s why we have focused our first step on the technologies that we viewed as most likely to meet the objective of a final investment decision in 2029.”

“This is a hugely exciting day for the nuclear industry, with 6 companies taking the first step towards delivering sustainable power for Britain. For companies who were not successful in this initial process, the next opportunity could be the government’s consultation on alternative routes to market for nuclear technologies which is due to be launched soon. This will look at how to support newer technologies so that Britain can benefit from them as well.”

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