Market changes have not had significant impact on fuel supply

Petrol and diesel stocks too low
Published on Thursday, 20 December 2012 12:08
Posted by Scott Buckler

A report has found that significant changes to the retail market for road fuels, including the increasing dominance of supermarket forecourts, have not had an impact on the availability of petrol and diesel for motorists

The Deloitte study, commissioned by the Department of Energy and Climate Change, shows that overall the number of forecourts in the UK has declined by six per cent in the past five years. This follows a trend of closures seen in the past 40 years from a peak of more than 37,500 in 1970, to less than 9,000 in 2011.

Primarily these closures have been of independently owned and operated petrol stations, with the supermarkets enjoying an increasingly dominant share of the market.

Deloitte found the vast majority of motorists (92 per cent of postcode areas) have more than two petrol stations 10 minutes drive away and the remainder have an average 13 minute drive to a forecourt. Average increases in driving times across the whole of the UK have been less than a minute as a result of market changes in the past ten years.

In the event of a total disruption to petrol and diesel supplies the retail sector holds up to eight days of fuel capacity to meet current demand, the report concluded.

Energy Minister John Hayes expanded the report to include consideration of the number of petrol stations available to people and the distance travelled to reach them, and how this has changed over time.

Energy Minister John Hayes said:

"This report was commissioned by my Department to get an accurate picture of the retail fuel market and to consider any possible implications for our security of supply. I expanded its brief to consider the important issue of fuel deserts in rural areas.

"Although it is very clear there has been a market shift from independent to supermarket forecourts in the past 40 years this has not had an impact on the vast majority of motorists.

"The report has also found the UK retail sector has more than enough capacity to meet fuel supply shocks before contingency measures are put in place.

"This Government has taken significant action to support retailers and motorists. We have effectively frozen fuel duty for 2 ½ years, easing the burden on motorists by £19bn over the parliament to 2015/16.

"Postponing the revaluation review has prevented significant business rate hikes for forecourts and the burden of high pump prices on extremely remote islands has been reduced with our Rural Fuel Duty rebate scheme."

"My officials will be working  with industry, trade associations and other government departments to ensure motorist always have a ready and secure supply of fuel. This report will help inform our further work here, as will the findings of OFT's Call for Information into this sector, due in January 2013."

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