Supply and demand are always the ultimate factors that determine the cost of any service or good. This is something to bear in mind as you consider the price history of red diesel in the UK. Largely used to power farm vehicles, this fuel source is valued all throughout the agricultural and livestock farming industries. Since its inception, the price of this fuel has risen and fallen in accordance with both its availability, and the attitudes and requirements of the consumer market. Learning more about this resource is the first step in understanding its cost and ultimate value.
Among some of the different forms of equipment that this fuel is used in are forklifts, cranes, combine harvesters, and tractors. It is primarily used in any machinery that is not operated on the road. Some schools and commercial facilities, however, have also used it as a heating oil. In both instance, it is stored in a special oil tank. This tank has an integrated filling hose and fuel meter for ensuring the safe transfer of red diesel when machinery is fueled up.
One of the best ways to prevent loss of this important resource is by investing in bunded tanks. These tanks prevent spills through the use of an outer well that captures any leaking materials. If tanks split, business owners will not have to contend with lost money, contaminated soils, contaminated water supplies, and contamination of other materials and areas.
Other issues that people face when using this fuel include something that is known as the “diesel bug”. This is a phenomenon that occurs when water exists within storage tanks. It may be present on the side walls of the internal portions of storage units in the form of condensation. This ultimately creates the ideal breeding ground for a swift-reproducing bacteria. Over time, this bacterium can create a viscous film that may lead to clogged, overheating, or otherwise damaged machinery.
Cold weather can also create problems for this fuel source as well. This phenomenon is known as “waxing up”. It usually happens in the autumn or winter and is most likely to occur with all-metal tanks. In areas in which the wind chill factor is high, many people opt against buying and storing this fuel during the coldest months. This is given that waxing will invariably render the product unusable.
In areas in which red diesel is not used for heating purposes, the demand for this product declines in a very seasonal way. After its winter decline, it again spikes when the weather grows warmer. This in turn impacts the cost over the course of any year.
It’s important to note that this is considered the least environmentally friendly fuel available. This has had a recent impact on demand along with legislative changes concerning the legality of use in specific environments. As new and more environmentally friendly options are considered, it may be that demand will see a further decrease.
Due to the seasonal impact of weather on fuel demand, it is important to consider the history of pricing in terms of average annual fuel costs. From the years 2003 to 2017, the average annual cost fluctuated significantly. The highest increase, however, was at 71 pence per liter (British pence) back in 2012. Since that time, the price has gradually declined with slight, yearly fluctuations based on changes in seasonal demand.