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War threat to fuel price!
Page 6
Page 7
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• Thousands of hauliers could be forced out of business if there is a significant rise in oil prices as a result of a war with Iraq.
Business analysts are already predicting that crude oil prices could double to $60 a barrel if supplies from nearby Saudi Arabia are disrupted following an American invasion of Iraq.
Earlier this week City accountants Tenon published a report predicting the price hike that would send UK pump prices shooting up by 14p/ lit or nearly 65prgal.
Last week, a former Saudi oil minister suggested a second Gulf war could send prices even higher, to $100 a barrel, if neighbouring Arab countries were in turn attacked Saddam Hussein. Whatever the military oi come, it is clear that a war would be very b news for the UK haulage industry which ti traditionally struggled to pass on fuel pr increases to customers.
Haulage industry analyst. David Pattison Plimsoll Publishing estimates that about third of all companies are in or close to wt he calls the "danger zone" and struggling make ends meet.
"The haulage industry has one of the hig est 'in-danger' rates, and that is before have considered the impact of a big die price hike," he says. "hi many ways a very I
price jump would be better for the industry than a small one as it would force every haulier to go to their customers and demand a big Increase in rates.
"The worst-case scenario is a modest rise in pump prices that most customers would expect their haulier to simply absorb,'' he adds. "That would have devastating consequences."
Last week the author of a Grant Thornton report into the state of the haulage sector also concluded that a diesel price rise would have terrible repercussions for the industry.
"It's highly unlikely that the government would step in and lower fuel duty in the face of a big jump in crude prices—it certainly hasn't in the past," said Dominic Swords of the Henley Management College.