Petrol prices ‘cause for concern’ says watchdog

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11th July 2022

Bite-sized business news from the UK and beyond

Good morning If you’re wondering where the 0.000000001% were this past week, they were in the state of Idaho for the 37th annual Sun Valley Conference aka “summer camp for billionaires”: For five days, the moguls listened to speeches, sat in on panels about politics, healthcare and the economy, and joined in on group activities from golf to fishing, hiking and cycling.

Today's stories

Petrol prices ‘cause for concern’ says watchdog
Musk backs out of Twitter takeover

CONSUMER
Petrol prices ‘cause for concern’ says watchdog

What happened?
A review by the competition regulator has found ‘cause for concern’ in the growing gap between the price of crude oil and the price of petrol and diesel at UK pumps.

How did we get here?
Last month the government asked the Competition and Market Authority to urgently review the petrol and diesel market after concerns that the 5p-a-litre cut in fuel duty had not been passed on to customers.

It comes at a time when the price of filling up at the pumps has reached a new record, with petrol and diesel close to £2-a-litre, up over 40% since the start of 2022.

The CMA found that rising pump prices this year have been driven by:

Soaring crude oil prices, which jumped following Russia’s invasion of Ukraine in March to $128 a barrel. Since then it’s eased back to just over $100 but has accounted for around a third of the jump in forecourt prices.
About 40% of the current growth in fuel prices was down to increases in how much refineries are charging retailers for wholesale diesel and gas.

Although there were concerns that fuel retailers were profiting from the current situation, the CMA found that over the course of a year, the gap between wholesale prices and retail prices hasn’t been a major factor to the overall rise in pump prices.

It also said in most cases, the 5p fuel duty cut has been passed on to drivers, though it has taken some retailers longer to do so than others.

Next up, a more in-depth investigation into forecourt prices. The CMA says that if it finds evidence of wrongdoing, it won't hesitate to take action.

Other stories to keep you in the loop

Conservative leadership race heats up as Tories clash over tax plans
Massive leak reveals how top politicians secretly helped Uber
Tesco and Heinz reach deal after ketchup and baked beans vanish from stores
Sri Lanka: Protesters 'will occupy palace until leaders go'
Lawyers gearing up for ‘wave of litigation’ due to crypto crash
Canadian pension fund backs $5.8bn 'buy now pay later' giant Klarna
Russia's McDonald's replacement runs low on fries
Luxury brand Tom Ford up for sale

TECH
Musk backs out of Twitter takeover

What happened?
On Friday Elon Musk announced his intent to back out of his deal to buy Twitter for $44bn.

Rewind: In April Musk agreed to buy Twitter just weeks before tech stocks collapsed. Since then, he's raised questions about the presence of spam bots on the platform. The world’s richest man and Tesla CEO is claiming that Twitter is in “material breach” of its contract with him, and therefore he’s seeking to terminate the deal.

Musk has made this complaint before, and demanded access to the "firehose" of tweets on the platform—the company gave it to him.

Yes, but: A deal’s a deal, and Twitter could sue to force Musk to go through with it even though he'd prefer to bail.

Musk would need to clear a pretty high legal bar to win a court battle, having to prove that Twitter intentionally misled investors in its public disclosures.
This may also be a negotiating tactic to pressure Twitter's board to accept a sale at a lower price.

What’s next: Don’t expect Twitter to let Musk walk away without a fight... without a deal on the table, the company’s shares are already falling and it has a strong incentive to push Musk to complete the acquisition.

Stat of the day

The US economy created 372,000 jobs in June, an indicator of resilience despite signs of slowing economic growth

Interesting links from around the web

Almost perfect: 55 films with 99% ratings on Rotten Tomatoes
How Norway became one of the richest countries in the world
Expecting a bad performance review? Here’s how to prepare

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Petrol prices ‘cause for concern’ says watchdog

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