What is the cost of gasoline in the United Kingdom?

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By Felicity Long

Gasoline in the UK

Gasoline, also known as petrol, is a crucial component of the transportation sector in the United Kingdom. It is used to propel cars, buses, and trucks, allowing people and goods to move around the country. The cost of gasoline is a significant concern for drivers, as it directly affects their personal finances and the economy as a whole.

Historical background of gasoline prices

Gasoline prices in the United Kingdom have fluctuated over the years, responding to changes in global oil prices, supply and demand, and government policies. In the 1970s, gasoline prices increased rapidly due to the oil crisis caused by the Arab-Israeli conflict. The UK government introduced fuel rationing and price controls to manage the shortage of gasoline. In the 1980s and 1990s, gasoline prices stabilized, but they started to rise again in the 2000s due to higher global demand and geopolitical tensions. In recent years, gasoline prices have been affected by the COVID-19 pandemic, which led to a drop in demand and a glut of oil on the market.

Factors that determine gasoline prices

The price of gasoline in the UK is determined by various factors, including the global price of crude oil, the value of the pound sterling, refining costs, distribution costs, and taxes. The global price of crude oil is the most significant factor in determining gasoline prices, as the UK imports most of its oil. Refining costs refer to the cost of turning crude oil into gasoline, which includes the cost of energy, labor, and equipment. Distribution costs are the cost of transporting gasoline from refineries to petrol stations. Taxes, including fuel duty and value-added tax (VAT), also have a significant impact on gasoline prices.

Current gasoline prices in the UK

According to the RAC Foundation, the average price of gasoline in the UK as of September 2021 was 135.9 pence per litre. This is slightly lower than the peak price of 142.48 pence per litre seen in April 2012 but significantly higher than the low of 95.7 pence per litre seen in January 2016. The price of gasoline varies depending on the region, with the highest prices in London and the lowest in Northern Ireland.

Comparison with other countries’ gasoline prices

Compared to other countries, the UK has relatively high gasoline prices due to the taxes imposed on fuel. According to the International Energy Agency, the average retail price of gasoline in the UK was $1.57 per litre in 2020, compared to $0.72 in the United States and $1.02 in France. However, the UK’s gasoline prices are lower than those in countries such as Norway, where the average price was $2.20 per litre in 2020.

Impact of taxes on gasoline prices

Taxes have a significant impact on gasoline prices in the UK, accounting for approximately 60% of the retail price. Fuel duty is a tax imposed by the government on gasoline, which is currently set at 57.95 pence per litre. VAT, which is currently set at 20%, is also applied to the price of gasoline, including the fuel duty. The government justifies these taxes as a way of discouraging excessive consumption of gasoline and reducing carbon emissions. However, they also make gasoline a more expensive commodity for consumers, particularly those on low incomes.

Strategies to reduce gasoline costs

There are several strategies that consumers can use to reduce their gasoline costs, including carpooling, using public transport, driving more efficiently, and switching to electric or hybrid vehicles. Carpooling involves sharing a ride with others who are travelling to the same destination, reducing the total amount of gasoline consumed. Using public transport is an alternative to driving, particularly in urban areas where public transport networks are more developed. Driving more efficiently, such as by avoiding rapid acceleration and maintaining a steady speed, can also reduce gasoline consumption. Switching to electric or hybrid vehicles can significantly reduce gasoline costs, as these vehicles do not require gasoline to operate.

The future of gasoline prices in the UK is uncertain, as it depends on a range of factors, including global oil prices, technology advancements, and government policies. The shift towards electric and hybrid vehicles is likely to reduce demand for gasoline, which could lead to lower prices. However, the government may also increase taxes on gasoline to encourage the adoption of low-carbon alternatives. The ongoing COVID-19 pandemic and geopolitical tensions could also affect global oil prices, which would be reflected in gasoline prices in the UK.

Environmental impact of gasoline consumption

Gasoline consumption has a significant impact on the environment, contributing to air pollution and greenhouse gas emissions. The combustion of gasoline releases pollutants such as carbon monoxide and nitrogen oxides, which can harm human health and the environment. Carbon dioxide, a greenhouse gas, is also emitted when gasoline is burned, contributing to climate change.

Alternative energy sources for transportation

Alternative energy sources for transportation, such as electricity, hydrogen, and biofuels, offer a more sustainable and environmentally friendly alternative to gasoline. Electric vehicles, which are powered by batteries, do not produce tailpipe emissions and can be charged using renewable energy sources such as wind and solar. Hydrogen fuel cell vehicles convert hydrogen into electricity, emitting only water vapor as a byproduct. Biofuels, made from renewable feedstocks such as vegetable oil or corn, can also be used as a substitute for gasoline.

Conclusion: The cost of gasoline in the UK

The cost of gasoline in the UK is determined by various factors, including global oil prices, refining and distribution costs, and taxes. Consumers can take steps to reduce their gasoline costs, including carpooling, using public transport, driving more efficiently, and switching to electric or hybrid vehicles. The shift towards low-carbon alternatives is likely to reduce demand for gasoline and could lead to lower prices in the future. However, the government may also increase taxes on gasoline to encourage the adoption of sustainable alternatives.

References: Data sources on gasoline prices

  • RAC Foundation (2021). Fuel prices. Retrieved from https://www.racfoundation.org/data/fuel-prices-uk
  • International Energy Agency (2021). Gasoline and diesel retail prices. Retrieved from https://www.iea.org/data-and-statistics/charts/gasoline-and-diesel-retail-prices
  • HM Revenue & Customs (2021). Fuel duty rates. Retrieved from https://www.gov.uk/government/publications/rates-and-allowances-excise-duty-fuel-duty/rates-of-duty-on-hydrocarbon-oils
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Felicity Long

Felicity Long, a seasoned travel journalist with 15+ years of experience, specializes in exploring Europe, family travel, and skiing, as evident in her book "Great Escapes: New England" (The Countryman Press). She edits the Europe eNewsletter and contributes significantly to TravelAsker's destinations sections. Felicity has received esteemed awards, including the Cacique and Yo Leonardo Awards, in recognition of her outstanding international travel writing accomplishments.

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