Diesel hits new record high at the pumps

The average price of diesel across the UK hit a new record high of 147.94p a litre on Sunday (October 31), surpassing the previous high of 147.93p set on April 12, 2012, according to the RAC.

It comes just a week after petrol also exceeded the record price achieved in April 2012 of 142.48p. Since then, it has gone higher still, peaking at 144.35p on (Sunday October 31).

The price of a litre of diesel has gone up a 30p a litre in a year, making a full 55-litre tank £16 more expensive (£65 to £81).

While the prime reason for higher pump prices is the fact oil has doubled to above $80 from $40 a barrel a year ago, the price of diesel is also strongly affected by the high cost of the biodiesel.

Currently, around 10% of the diesel drivers buy at the forecourt consists of biodiesel, which contributes around 16p a litre to the cost, whereas ‘pure’ diesel (93%) makes up around 40p. Biodiesel is also three and a half times the price of diesel itself on the wholesale market – a tonne costs around £1,800 whereas diesel is £520, says RAC.

RAC fuel spokesman Simon Williams said: “While this isn’t unexpected as petrol has already hit a new record price, it’s still another body blow to drivers and businesses across the country who were already struggling to cope with rising prices.

“As well as hitting household budgets this will have a knock-on effect on the price we pay for goods and services as diesel is very much the fuel of business and, as such, will contribute further to inflation.

“While the price of diesel on the forecourt has primarily shot up due the cost of a barrel of oil doubling in the last year from around $40 to more than $80, the price of biodiesel is now two and a half times what it was 12 months ago. This means the biodiesel content in a litre has rocketed from 7p to 16p, while the pure diesel component has doubled from 20p to 40p.

“Unlike petrol where retailers have increased their margin on every litre sold compared to 2012, the profit being taken on diesel is the same as it was nine and a half years ago, so we’re pleased to report this isn’t adversely contributing to the record price at the pumps.”

The new record price will be felt by the UK’s 12.5m diesel car drivers, along with increasing costs to businesses. The UK has 4.5m vans, the vast majority of which run on diesel, and 525,000 heavy goods vehicles.