Operating costs that influence the price at the pump include:
- Operation of oil depots and terminals
- Delivery of fuel from oil terminals/depot to retail stations
- Administration and marketing
- Operation of retail station, including labour, rent and utilities
Currency fluctuations
Product prices are traded in US$ per barrel and as such, Singapore consumers will be impacted should the US dollar move up or down, as this impacts on our purchasing power.
Unpredictable / extreme weather events
Hurricanes Katrina and Rita in 2006 temporarily reduced the refining capacity of the US and thus reduced the available supply to the market. Such reductions and speculation about availability of refined products (e.g. petrol) have caused volatility in refined product prices globally and demonstrate how extreme weather events in one part of the globe can affect prices at the pump in another.
Seasonality effects
The onset of winter in the US, Europe and Japan increases the demand for diesel and kerosene to heat homes and offices. A change in demand for fuel products in these major markets can also have a significant impact on the cost of different fuel products globally.
