Fleet News

Diesel prices set to rise further

Fleet managers under pressure following the recent rise in the price of diesel, which recently broke the £1 a litre mark, are being warned that diesel prices will continue to rise.

It is predicted that prices will continue their upward spiral at least until the start of 2008 as demand for heating oil puts added pressure on already stretched reserves.

According to Luke Bosdet, spokesman for the AA, diesel prices will rise again before they fall. “There is a hope that prices may come down after the New Year,” he said.

“But we are almost certain that they will remain above £1 a litre, and will probably rise again before then.”

Matters were made worse last month when the Chancellor imposed an extra 2p per litre increase in fuel duty on diesel

Clive Howlett, fleet manager at Plumb Base, who manages a fleet of 530 cars and vans, 90% of which are diesel, says the recent price increase will add some 4% to his annual £1.5 million fuel bill.

“We have to reduce the cost of fuel as much as possible,” he said. “We need to educate our drivers to fill up at lower-cost outlets.”

His solutions include suggesting boycotting high-price outlets, although this, he says, would be met with resistance as many drivers opt for convenience and loyalty schemes over price.

Despite the recent price rises, there has been a marked rise in the popularity of used diesel-powered superminis, with price premiums over equivalent petrol models more than doubling on certain vehicles since last year.

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