Fleet News

Industry set for agony as fuel prices rocket

FLEETS are being warned that their fuel bills could soar as the prospect of prices hitting £4 a gallon edges nearer.

Oil prices have hit a 13-year high, with the price of a standard barrel of crude oil hitting £20.22 last week, the highest levy since the Gulf War in 1990.

By opting for the more expensive stations an average fleet of 500 vehicles could be spending an extra £50,000 every year on fuel.

Teresa Maynard, head of fuel at Castle Fuel Cards, explained: 'Fleets will soon begin stipulating where drivers can fill up. The typical saving on a tank between the most expensive filling station and the cheapest is on average £2. So filling up once a week, it equates to £100, and for a fleet of 500 cars this is an added £50,000 a year in costs.

'We will see a lot more focus on where drivers buy, determined by price. Fleet drivers still have to complete the same mileage so the only way to mitigate a severe impact is to buy as cheaply as possible.'

A recent survey completed by fuel card supplier Castle uncovered the cheapest and most expensive parts of the UK where fleets buy fuel.

Fleet drivers filling up in central Scotland – around Glasgow and Edinburgh – win what is described as the 'fuel price lottery', while those topping up the tank in East Anglia lose out (Fleet NewsNet, April 22).

High oil prices mean petrol prices are approaching the 80p-a-litre mark which triggered demonstrations against prices almost four years ago.

Maynard said: 'The situation is not going to stop and it is serious for fleets. There is a possibility that world oil production has peaked. From a supplier's point of view, it is downhill, but from a price point of view, it is uphill. Unless there is a change in trends, by 2005 it will be 90 pence a litre.'

The Retail Motor Industry Federation (RMI) claims the American economy is the main driving force behind the petrol hikes.

Ray Holloway, independent garage and fuel director at the RMI, said: 'A number of factors are pushing up crude oil process, but the key cause is the weak state of the US dollar.'

Prime Minister Tony Blair admitted last week that such increases could have a 'severe impact' on motorists and consumers. Speaking at a press conference, he said: 'We are in discussion with oil producers and we will look carefully at the impact of oil prices.'

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