Sky News business editor Michael Wilson

As the protesting lorry drivers bring much of London to a standstill, so the economy which those truckers serve is going into reverse. Never mind the surging fuel costs, firms transporting goods and post, for example, saw volumes and values of business falling at the fastest pace for ten years.

It’s part of the latest CBI snapshot of the services industry, from hairdressers to bars and restaurants, from accountants to personal trainers – the largest section of UK Plc. It makes fairly depressing reading, and its gloomy findings are a direct consequence of consumers reining in spending on leisure, entertainment and eating out. And as the housing market stagnates and the normal seven year cycle of moving stretches to between 11 and 15 years it’s not just the removal companies feeling the pain, but a whole swathe of furniture and DIY companies. This crisis is hitting all parts of the economy.

I’m sure I don’t need to rehearse all the reasons , but there may be a glimmer of hope about the oil price, which is crippling consumer and businesses alike. We spoke to George Soros last week, whose take on crude prices was that there’s a huge premium of speculation  in their record highs and it will take a recession in both the UK and the US to depress the demand for the black stuff, and thus bring the price down.

Well, that’s probably true – but it was interesting to read over the weekend that Anthony Bolton, one of the City’s leading fund managers, saying that he would switch out of commodity stocks like metals and oils and move into financial stocks. He has never been part of the herd, but then again he is very influential. If this proposed switch in investment strategy were to translate into a wider move, we could see the beginning of the end of the present oil spike. That’s a big ‘could’ mind you.   

Comments

[michael wilson 27 May 2008 16:04:43]

michael - thank you very much for that information..the cbi noted similar problems in its report this morning..i'll keep that on file,especially how difficult it is to quote for a job under the present circumstances.
regards
michael

[Christopher 27 May 2008 15:56:29]

Dear Michael,
I wonder how much longer you and many politicians will continue in denial that what we are experiencing is Peak Oil?

Mr Brown's frequently repeated idea that he can get OPEC to pump more of the black stuff is utterly absurd.
They cannot.
Saudi's Ghawar well already has a very unhealthy water cut of over 50%, suggesting that it has already peaked.

As for me, I'm holding on tight!

regards
Christopher Millbank
London, UK

[Elizabeth Davies Cape Town 27 May 2008 15:53:54]

Michael
When have you known a trader to pull out of a market that is booming, unless he knows something others don't, hope it's legal!
Brown's Britain is bursting, it is now ...bust,bust and bust. No end in sight.

[Michael Cornwall 27 May 2008 14:23:00]

Fuel is a big issue for Cornwall. I have spoken to Julien Chenoweth, from Maenkarne Aggregates Ltd . in Truro. He is the spoksman for the Haulage Contractors throughout Cornwall. He tells me that we don't have motorways down here and alot of hills so we use more fuel.He has put his price upby 8% in Jan and a further2% 1st June The hauliers do not know how to price at the moment a quote older than a month could work out expensive. The local hauliers are planning a local demo on Saturday. What they want is 25p a road hualage user rebate per litre. What I want is some clarity from the Government.

[Khalid 27 May 2008 11:39:54]

Sir
Whilst the greatest of sympathy goes to all drivers and not just those within the haulage industry, one thing that no other country can be proud of is the way in which we as a nation take such protests with dignity and due regard to current legislature.
Now if we are looking for reasons as to why prices have hiked, then I'm sure well get more than the daily barrel output, however, OPEC and its producing nations need understand just one thing and that is, having mastered the art of extacting oil from mother nature for decades, and with prodcution/dissemination costs further curtailing by the year, it beggars belief that todays' price is 100% greater than the same period 12 months ago.
Politicians alongside OPEC need to fix the price per barrel for every country to no more than $75 or lower, and as such guarantee such prices for 10 years hereafter.
The fruit of this practice will be that starvation and disease will be eradicated bringing about sustained economies for all, rich and poor. The other added bonus will be the giving of much needed sawab points to the divine and holy who will no doubt agree that golden palaces and golden taps cannot be taken to pastures beyond earth, therefore the more we disseminate the better a planet we create for all.
As we go along, we need to look at the purpose of the EU, whose ideological practices benefit everyone but UK drivers.
Therefore [Tina Turner] we all need to stand shoulder to shoulder and say [I Dont Wanna Fight Anymore] and enjoy happy days.
Now, as for the petrol giants, they need to do their bit and immediatley reduce the price of petrol for all by 25p/litre and get those MPs with years of expense claim practice reclaim that proportion from OPEC otherwise aviation fuel will have to rise by 25p.
Oooh, must dash Mr Angry' in town! How are you? (ouch) Thus far as road tax etc, so long as we assure drivers that congestion charge will not be charged, can't see what the fuss is about as everyone pays. By the way, what does prudence mean, cos I've heard that term man hy a time during the last 10 years? anyone??????