Fuel companies should lower UK prices, says government

6th Nov 2014 06:46

Chief secretary to the Treasury Danny Alexander has demanded that fuel companies lower their prices in response to the recent falls in the cost of oil.Addressing the Highlands & Islands Branch of The Energy Institute in Aberdeen on Thursday, he will say that people will "rightly be angry" if they are not allowed to benefit from the drop in crude oil prices.In June 2014, oil costs plummeted from $115 per barrel to $84 per barrel."I believe it's called the Rocket and Feather effect," he will announce. "The public have a suspicion that when the price of oil rises, pump prices go up like a rocket. But when the price of oil falls, pump prices drift down like a feather."Even though he has no research to support this concept, Alexander will argue that the public still sees the industry this way, causing them to feel animosity towards it.A spokesman for the Department for Energy and Climate Change said on Thursday: "The Government is doing everything within its power to help hard-pressed families keep their energy bills down."In December we announced plans that will save customers around £50 on their energy bills, protecting support through the Eco scheme for vulnerable households, extending the scheme for an extra two years and making an additional £450m to make Britain's homes more energy efficient."This is on top of the support already available to vulnerable households through schemes like the Warm Home Discount, whereby well over one million low income pensioners will receive £135 off their bill, and Winter Fuel Payments."Three UK supermarkets claimed in September that they would lower fuel prices. Tesco and Sainsbury's have announced a decrease of up to five pence per litre.Asda has also announced that it will drop petrol prices by one penny and diesel costs by two pence.