How to Beat the UK’s Expensive Diesel Fuel Prices

Businesses that depend on a fleet of vehicles continually strive to minimise their fuel expenses, but depending on an international market means managers will sometimes face significant challenges.

One recent challenge is the unwelcome news that the UK has the most expensive diesel in Europe. It is now more important than ever for managers to explore strategies that will help their business reduce its fuel costs. Read on to find out more about this announcement and discover how Fueltek has helped many businesses across the UK get the most out of their diesel.

UK Fleets Pay More for Diesel Than European Counterparts

The RAC has discovered that UK commercial fleets are paying higher costs for diesel compared to Ireland and the rest of Europe. Despite the 5p-a-litre duty discount implemented over two years ago when it was reduced from 57.95p to 52.95p in the spring of 2022 to alleviate the impact of rapidly rising fuel prices following Russia’s invasion of Ukraine, the UK still has the highest diesel duty rate.

For example, France, with a duty rate only marginally lower than the UK’s at 52p, still manages to offer diesel at 146p per litre, which is 9p less than in the UK. In Belgium, where the duty rate is 51p—2p less than the UK—the average price of diesel is 150p, 5p cheaper than in the UK. Closer to home in Ireland, diesel at forecourts is 5p less than in the UK at 150p, and the duty is also 6p less at 47p per litre, although the VAT is 3% higher at 23%.

This has added another challenge to overcome in combatting the various costs of commercial fleet management, but thanks to our decades of experience with commercial fuel management systems, we know excellent ways to still lower your fuel costs permanently despite international events. For example, having access to wholesale diesel fuel is a significant initial step towards reducing fuel costs and mitigating the financial challenges posed by these circumstances.

Diesel Fuel Price Concerns from RAC and CMA

At Fueltek, we are always keeping track of the current state of fuel prices and predictions to generate accurate impressions of the challenges our commercial fleet customers have to overcome. Whilst we have already stated that the overall costs for diesel have risen, there is a significant difference between choosing wholesale and retail fuel.

The RAC Foundation has shared that as of the end of May 2024, the average diesel pump price is £153.70, whilst the wholesale prices are far lower at £104.78.

The wholesale price includes the mineral diesel price, fuel duty and any relevant biofuel elements at the refinery gate. The retail price includes product costs and fuel duty, as well as extra distribution and the significant retail margin of forecourt costs, retailer profits, and VAT.

The CMA (Competition and Markets Authority) has also collected the same concerning data over recent years. In terms of percentage for retail costs, the recorded margins were at 6.4% in 2017, but this had increased to 9.1% by 2023. The Senior Director of Markets at the CMA, Dan Turnbull, shared his opinion that the increased margins are a sign of weakened competition that, as a result, is hurting fleet businesses. The retail spread for both petrol and diesel recorded in 2023 is continuing and is making reducing fuel costs on an individual driver level difficult when relying on retail sources.

How Does Wholesale Fuel Help Fleets?

Both the RAC Foundation and the CMA have provided the data needed to state that wholesale fuel is always a better choice for your fleet fuel needs, but there are more benefits to this choice.

For example, the initial reduced cost certainly makes this an obvious choice, but this choice is further supported when you consider that wholesale fuel is purchased in bulk, where cumulative discounts are often applied along with loyalty bonuses from repeat business.

Another benefit is more efficient use of your purchased fuel. When you have complete control over your wholesale fuel, you get to dispense it to your drivers at your convenience and eliminate the need for them to go out of their way to source the fuel they need.

Wholesale fuel also eliminates the reliance on wasteful fuel cards. These cards are not always compatible with every fuel station, creating more delays for your drivers and relying on the erratically increasing retail fuel prices listed earlier.

How to Invest in Wholesale Fuel

At Fueltek, we offer practical solutions to businesses looking to make the switch to wholesale fuel, including:

• Installing bunded diesel tanks
• Fuel dispensing equipment
• And effective fuel management systemssuch as Fuel Manager Online (FMO)

Think of these combined systems as a complete fuel management package for a business to run its own safe, secure, and legally compliant fuel station at its facility. The concept is clear: you purchase your cheaper wholesale fuel in bulk and store it in your tanks for later use. The associated pumps and monitoring software will allow your drivers to take what they need to complete the required work without the need for external events such as visits to forecourt fuel stations.

Wholesale Fuel Management Options at Fueltek

Our online catalogue features a range of bespoke storage solutions and commercial fleet fuel management systems to suit any business needs. Contact us today, and our team of experts will guide you towards the best wholesale solution for your business.