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Price bull?

Having bought my first diesel this year I am fed up watching the
difference between diesel and petrol prices grow ever wider. Currently the margin is around 15p in South Wales. There was a time when diesel was cheaper than petrol and I believe this is still the case on the continent. Is there any justification for this?

Asked on 24 January 2009 by

Answered by Honest John
Depending on the crude oil itself there is a limit to how much low sulphur diesel can be refined from each barrel of crude, unless new types of multi million pound refineries are built. Unfortunately, worldwide demand is relatively greater for the amount of diesel that can be refined from crude than it is for petrol. It's used for trucking, shipping, railways, heating, farming, etc. So really, everyone who uses it in private cars is putting up the cost of diesel for more essential uses, which puts up the price of everything. Europe has more diesel then the UK because it can store more, which is why
diesel is dearer in the UK than in Europe. But in countries like Thailand diesel is around 20% dearer than petrol, and they don't need it for heating because it never gets cold enough. The tax is the same as petrol: now 52.35p + VAT + VAT on the fuel. But because of the 2.5% VAT reduction, a litre of diesel costing 115p should come down to 114.85p, a reduction of 0.15p, or 0.13%. Wow.
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