Stopped to get fuel at th’Asda just off the M5 at Oldbury yesterday, and both petrol and diesel were identically priced at 114.7. I was a bit chuffed and thought I was taking advantage of a small pricing error, and filled my boots tank with the cheapest derv I’ve seen for a little while. However since then I’ve noticed that the gap between the two has closed significantly and at a few outlets have reached parity. What’s going on? Is diesel not the Devils own fuel now? Or is Petrol suddenly equally evil. Certainly it makes me a little more happy driving a dirty smoking (euro 6) oil burner these days…

I am just disappointing we don’t pay French diesel prices. I paid @80p/ltr last week over there 🙁

Could be that a lot of folk are going back to petrol cars as they’ve upped their game economy wise. Supply and demand possibly?

If you’re ever driving through Andorra, make sure you get there nearly empty, the fuel prices there are ridiculously cheap.

Allegedly the wholesale price of diesel and petrol has been the same for weeks

118p for BP diesel here and we’ve got a refinery less than 10 miles away 🙁

Liking the near-equality though – I was wondering about that myself.

Great news right now, but is it still the case that we’re expecting diesel to reach silly prices in the future because of how evil we’re being told it is?

The “wholesale” price of diesel has always been cheap – the suppilers cottoned on to the uptake in diesel cars years ago and promptly ripped everyone off…..
€1.14 in germany last week for diesel and has been that way for a long time.
Its roughly half the cost of petrol to produce – so the rest is clear profit on the back of the higher mpg

It’s simpler than all that.

In Britain we have more Petrol refineries than Diesel ones, when the market shifted to predominately diesel way-back-when we were left over-supplied with Petrol and undersupplied with Diesel – it’s not just supply and demand though, we export petrol to the continent and import diesel (largely from France).

As the £ strengthens against the € it makes diesel cheaper and petrol more expensive as we get less for out exports.

Could the situation actually reverse, and diesel be cheaper than petrol?

rocketman – Member
Allegedly the wholesale price of diesel and petrol has been the same for weeks

it’s been the same for a lot longer than that i can assure you.

What P-Jay says is correct, we import most of our diesel and the market is making use of a weak euro and an over-supply on the market. DERV species are trading at minus figures depending on type everywhere. That said, you wont see the Majors with a same price, the supermarkets are still discounting heavily for advertising/trade-off reasons.

The question should be “Why have petrol and diesel prices increased so much over recent months, when the price of oil hasn’t?”

End of Tesco fuel saver option though 🙁 No more 20p off a litre, makes me feel positively greek

Looks like diesel is still slightly pricier on forecourts:

Compare UK Petrol & Diesel Prices

Daffy – Member

The question should be “Why have petrol and diesel prices increased so much over recent months, when the price of oil hasn’t?”

Can only speak for myself, but Diesel where I buy it dropped to about 114p in Jan and a risen slightly to 117 since.

Oil Prices hit a low in Jan and have been on a slight upwards trend since, considering the price of the raw material only makes up around 40% of the pump price, it’s about ‘on-par’ I’d guess.

In Norway a couple of weeks ago and diesel was cheaper than petrol.
Mind you I was 100 NOK (about £11) for a bottle of beer

v8ninety – Member

Could the situation actually reverse, and diesel be cheaper than petrol?

Yes, but not easily.

The price is made of up different components.

Duty is the Big one – 58p per litre, same for both.

Raw Material is next – you need slightly more Oil to make 1ltr of Diesel than you do Petrol so petrol will always be cheaper to produce.

Then it’s VAT, which is the same for both.

Cost of production is technically the same, but as above, diesel costs more in transportation because a lot of it has to come from Europe

Then there’s the retailers cut, which could be anything, but because we buy a lot more diesel than petrol in the UK, the cut is usually slightly less for diesel because of the economies of scale.

So diesel genuinely costs more, to make it cheaper than petrol relies on the imbalance of production in the UK to remain the same and the strength of the £ to the € to increase to a sufficient level to over-come the cost.

The whole picture is going to continue to move – Petrol is making a come-back for car users, and there have been rumblings that the tax benefits for company car users for using diesel may end because of a shift of focus away from Co2 to other pollutants if that happens then a massive shift back to petrol will change everything, but could go either way.

v8ninety – Member

Could the situation actually reverse, and diesel be cheaper than petrol?

When I first bought my current car (first diesel car I’ve owned) in Sept 2006, diesel was quite a bit cheaper than petrol. I think it was about 5p less; diesel was around £0.90/litre.

Why have petrol and diesel prices increased so much over recent months, when the price of oil hasn’t?

Oil price in January was less than $50 per barrel and throughout May and June was over $60 per barrel, currently just below $60 after the Iran announcement. But hey this is the internet so don’t let such easily obtained facts get in the way of things.

Just went past an Esso / Tesco station. Unleaded @115.9p. Diesel @114.9p.

So yes, first reverse in prices for years.

£1.14 for both at local sainsbo’s last night

It’ll be due to a drop off in demand from China. That is what was driving the price differential before. Diesel is a lot cheaper to produce than petrol so it’s supply vs. demand driving the price.

When I first bought my current car (first diesel car I’ve owned) in Sept 2006, diesel was quite a bit cheaper than petrol. I think it was about 5p less; diesel was around £0.90/litre.

I think your recollection is off there. I’m not aware petrol has been more expensive than diesel in the UK in all the time I’ve been looking (only 12 years or so admittedly), but I was just behind you in my first diesel in August 2008, and the disparity was huge – about £1.05 for petrol and £1.25 for diesel, I remember having to go straight to the forecourt from the garage and nearly crying.

Diesel used to be cheaper, it was taxed at a lower rate to encourage people to switch.

Can’t remember when that was though.

Report from DECC shows 93p vs 96p for Sept 08 for petrol/diesel, by 08 that was 112p/124p.

Petrol hasn’t been cheaper than diesel at any time in their reporting period, which goes back to 2003.

spreadsheet

It’ll be due to a drop off in demand from China. That is what was driving the price differential before. Diesel is a lot cheaper to produce than petrol so it’s supply vs. demand driving the price.

I thought macro stuff like demand in China is what drives the price of crude oil, not an explanation of the price disparity between different refined fuels at the pumps in Oldbury. The price disparity has more to do with what P-Jay is saying IMO. I think your example is a reason why, for example, diesel is currently £1.18 rather than £1.30 of a year or two ago. the most recent influence on crude oil price is the Iran deal a few days ago.

on the continent diesel has (since i’ve been living there, at least) always been cheaper than petrol.

high-end (i.e. Shell V Power or equiv.) deisel is cheaper in Germany than supermarket stuff here in the UK.

on the drive over to the UK i was thinking about stopping off in Luxembourg and filling up. (worked out ~8€ saving on a full tank plus a 60km round trip/detour)

i’m hoping my half tank will get me to France or Belgium before having to fill up.

and Super for comparison.

We are 3p a litre cheaper on diesel than petrol at the minute, there is a glut of diesel at the minute, but most retailers are on the take so keeping it artificially higher.

My fuel of choice (LPG) has steadily been going down, my local retailer dropped their prices to 49ppl last week 😀

Someone once told me that diesel gets cheaper in the summer because it’s used to heat many US homes. As more heating fuel is required in winter, the demand for diesel drops in the summer and the price goes down a little (or increases more slowly). No idea if it’s true but I suppose the point it makes is that factors other than forecourt demand may be affecting the price,.

gonefishin – Member
Oil price in January was less than $50 per barrel and throughout May and June was over $60 per barrel, currently just below $60 after the Iran announcement. But hey this is the internet so don’t let such easily obtained facts get in the way of things.

In 2014, oil was $120/barrel, and petrol was 132p/l and then in January, BC dropped to $53/barrel with petrol at 106p/l. Now BC is $60.6/barrel with petrol at 119p/l.

So, BC dropped by almost 60% in Jan 15 resulting in a 26p/l drop at the pump. BC prices have now increased by 15%, but pump prices have gone up by 13p/l.

Let’s simplify it: BC drops 60% and pump prices drop by 25p/l, BC increases by 15% and goes up by 12.5p/l, so by those figures, should BC resume its 2014 price of $120/barrel, pump prices will be 156p/l.

I hope you don’t work with numbers for a living.

Daffy, I only posted to correct the self evidently incorrect statement that you made that petrol/diesel prices have risen but crude oil hasn’t.

Your subsequent analysis about relative price movements is over simplified for several reasons. Your assumption seems to be that a change in oil price will only impact the cost of fuel as a change in raw material costs. This is incorrect as the cost of manufacture (in addition to raw material costs) is also a function of the oil price since the energy required to refine the crude will be cheaper with cheaper fuel prices. As a result a drop in oil price will result in a drop in petrol prices/diesel that is greater than that which would be the case by dropping the price of the raw material on its own. The corollary of this is that when crude prices rise the subsequent rise in petrol/diesel price is greater than that which can be explained by the rise in raw material costs.

The other factor that you appear to have ignored is currency fluctuations. Oil is traded in US dollars, retail petrol/diesel in GBP and I have no idea what the wholesale market trades in!

Whether or not there is fixing in the wholesale market is not something that I can comment on but I do know that every time it has been investigated the answer has come back negative, in spite of what people think.

As it happens I do work with numbers (oil industry as it happens, though not refining) and I’m pretty good at it. Certainly good enough to realise that things are generally a bit more complicated than they might appear to a lay person.

njee20 – Member

I think your recollection is off there.

Yeah, weird that. I was convinced it was the case, but found a chart yesterday that showed diesel more expensive than petrol for many many years.

I’ve got my geek fuel economy spreadsheet on my laptop for this car & my previous one. I note down the cost of the fuel with each tank so it will be easy enough to prove my memory incorrect!

Daffy – Member
The question should be “Why have petrol and diesel prices increased so much over recent months, when the price of oil hasn’t?”

looks to me like it has. At my local station, Diesel reached a low point of 108ppl in march/april, it’s currently 113ppl, it might have been 120ppl tops a month ago. Certainly roughly consistent with this graph

Daffy, I only posted to correct the self evidently incorrect statement that you made that petrol/diesel prices have risen but crude oil hasn’t.

Fuel duty is ~60ppl, with VAT being another 20% so ~25ppl so the actual ppl(just fuel) in Jan/Feb was ~25ppl. What I’m saying is that it’s now costing ~37ppl (probably 35 given the extra VAT, but still), an increase of almost 50% whilst crude has risen by only 15%. Your statement of refining being cheaper when oil is cheaper simply makes it worse.

I didn’t ignore currency fluctuations, I just deemed them irrelevant over the time-scale I was looking at – USD>GBP is near identical from Dec-14 to now. There was a period of a stronger dollar in April, but it lasted only a few weeks.

This isn’t my first Rodeo.

B.A.Nana – Member

looks to me like it has.

Expand that graph to look at 2 years, not just April to June and you’ll see what I’m talking about. A 50% decline Jan-Dec14 (with pump prices excluding tax dropping from ~55ppl to ~25ppl) followed by a 15% rise from April-July15 (pump prices rising to 37ppl) With these figures, and assuming gonefishings model for refinement costs increasing with raw material costs, you can expect ppl prices of 165-170ppl (inc Tax) should oil prices resume their $110-120 price.

My earlier statement, should have been more accurate. I fully agree that oil prices have increased, but I’m saying that the percentage increase in oil, is not reflected in the percentage increase in price at the pumps. At all of my local Shell stations, the pump price I’m paying (119ppl) is not far away from the price is way paying in 2014 at 132ppl.

Driving home on the M1 yesterday, just south of Milton-Keynes, I passed a petrol station displaying regular unleaded at 141.9 per litre. Is this the current record?

Still about 15p short of a garage just outside Rothbury.

Nope – M1 J22 BP is £1.48 – when I topped my tank this morning.
Cost me £29 in comparison to yesterday in Fareham at £1.14

when I topped my tank this morning.
Cost me £29 in comparison to yesterday in Fareham at £1.14

I guess if it cost £1.14 to fill your tank yesterday it wasn’t very empty.

1 week later and Diesel was cheaper than unleaded at asda this am (1.12 something vs 1.13 something)

We filled up the other day at Tesco in Irvine, 2p a litre cheaper than petrol.

Got stung at a BP “services” off the A1M the other week, advertised at 129 a litre (still ridiculous) but charged at 136 a litre. Gits.