Why is diesel so expensive compared to petrol? Prices explained

DIESEL prices have soared well above petrol in recent months and are refusing to come down even though oil prices have been slashed.

The latest figures from the RAC show that diesel is on average 24p per liter more expensive than petrol, despite generally having lower production costs.

Fuel prices have soared in recent months, partly due to the war in UkraineCredit: Getty

Buying diesel from a petrol station in the UK will cost motorists an average of 189.27p per litre, with the price expected to rise in the coming weeks.

Changes in supply and demand due to the war in Ukraine and changing seasons have sent the price of diesel out of control.

Why is diesel so expensive?

According to the auto magazine Auto Express, the rising fuel prices are the result of OPEC oil producing countries significantly cutting production.

A spokesman for RAC Fuel told them: “Since OPEC and its allies agreed to cut oil supplies significantly, we have seen the price of wholesale diesel rise by 9p a liter and petrol by 4p a litre.

“This has seen the average price of diesel rise by almost 4p a liter and petrol by almost a penny.

“Unfortunately for diesel drivers, the situation looks certain to get worse with prices returning to 190p a liter which will add £3 to [average] cost per tank.”

Will diesel prices fall?

In short, not for a while.

Diesel prices have actually already fallen, with the current average price 19p per liter lower than in July.

However, the factors that make diesel particularly expensive compared to petrol are still putting upward pressure on prices and are expected to do so for at least several months.

Things affecting the price at the pump include the global price of oil, which has risen, and the pound-to-dollar exchange rate (since fuel is sold in dollars per metric ton), which has weakened recently.

A spokesman for the RAC told The Telegraph: “While some remain largely static – such as the fuel duty rate and VAT – others such as the price of oil and the dollar to sterling exchange rate can be very volatile.

“This explains why prices go up and down. The combination of high oil prices and weak sterling is driving the highest prices at the pump.”

Why is diesel more expensive than petrol?

Declining oil production should raise the price of all fuels, not just diesel.

Gasoline prices, however, managed to remain low as gasoline demand declined, particularly in the US, as Americans use their cars less in the fall and winter.

Meanwhile, diesel is being used to power generators and heaters, as well as a substitute for gas amid shortages caused by Putin’s invasion of Ukraine.

This means that as the weather gets colder, demand for diesel has increased, sending prices sky high.

Russia is not only the main source of gas for Europe, but also a major exporter of oil, meaning that as nations stop buying from the Putin regime, further pressure is placed on fuel prices.

Changes in supply and demand also pushed up diesel prices, while petrol remained cheaperCredit: Getty

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