CHEAP fuel for fleets over the internet could be a reality in Britain by 2002, according to market analyst Datamonitor. Online sales of petrol are rocketing in the USA, where more than two million gallons were sold to 100,000 customers in July alone, and five million people are expected to have signed up to e-commerce purchasing schemes by the end of the year.

But Datamonitor warns that take-up in the UK, where forecourt prices have risen to the highest in Europe, could be hampered by oil companies who see web-based fuel sales as a threat to core business.

The company's latest report 'eCommerce in forecourt retailing' highlights as an example US-based Priceline.com which allows consumers to bid for goods and services, including fuel. Customers are encouraged to 'name their own price' for petrol, and successful bids are logged for exchange at filling stations using a special debit card. It claims private motorists are making savings equivalent to 2.5-3.5p per litre in this way.

Priceline has revealed it plans to enter the UK market by 2002, but Datamonitor says the company could struggle for business. Energy analyst Shon Loth said: 'Although the possibility of cheap petrol could well attract price-sensitive UK consumers, success depends greatly on the co-operation of the oil companies. In the highly competitive UK fuel market, suppliers are constantly looking for ways to hold on to their customers. To persuade oil companies to co-operate, online fuel retailers like Priceline.com will have to focus on the lock-in aspect of the scheme.'

But he believes e-commerce fuel sales have a future. 'Despite the difficulties in implementing on online petrol buying service, the anticipated growth in on-line consumerism in the UK means the concept remains viable,' he said.

• To access the Datamonitor site click on the Buyers' guide menu button (left) and go to the Research and consultancy section.