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What will a fall in commodities prices mean

asked by Ro Garderner posted 2 Years ago at 8:21
If raw materials prices are falling does that mean we'll start to see lower prices at the petrol pump fall, as brent crude fell the other day by 9%. Will prices or ever be passed on to consumers or will they just use it as another way to cream some more profit/
1-1 of 1 Answers
MBL Financial answered 2 Years ago at 11:17, last modified: 2 Years ago at 14:56
From experience (particularly at the petrol pump) one very rarely sees any short term drop in commodity prices reflected in the consumer prices. Mainly due to the drop possibly being short term and not a general trend, also due to the fact that the majority of the cost of an item, whether it be fuel, food or coffee etc, is down to the costs involved in transport and storage etc and tax, these represent a large portion of the cost to the consumer.
So any amount saved in the short term fall in price, is often (not always) retained by the seller and not passed on.
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