Latest Fuel News

BP is to terminate its agreements with Arval due to “escalating costs”. With Effect from 31 October, BP will no longer accept Arval fuel cards at its company operated sites. In addition, retailers have received letters from BP’s Fuels Operations Manager Peter Molloy stating Arval costs have “increased significantly” in recent years and are “simply unsustainable”. The letters add that, had BP continued its agreement with Arval, it would have had no alternative other than to pass the costs on.

While BP will no longer accept Arval at its company operated sites from 31 October, it has informed retailers they are free to continue - but they will need to deal directly with Arval. According to the letters, BP’s online authorisation service will no longer apply to any cards issued by Arval UK Ltd.

BP’s UK site network consists of approximately 450 company owned sites and 800 dealer operated sites.

The letters also outlined that, as a consequence of the move, dealers “will not be able to obtain on-line authorisation or carry out any pollng of Arval Cards using the Donne terminals.”

They add BP will “not provide any on-line authorisation services or polling services for any Arval cards”, and will “not pay on your behalf any Merchant Service Charge fees relating to any Arval Cards”. So if retailers want to accept Arval Cards after 31 October they will have to deal directly with Arval, and absorb the extra costs.

As an added sweetener, BP has offered retailers a reduction on their fuel purchase price if they enter into an agreement to only accept BP branded fuel cards and selected partner cards at their site. The cards in the exclusivity agreement are BP PLUS, BP PLUS Bunker, BP Agency, Shell Agency, Totalcard Commerical*, Totalcard Fleet, Agip Routex, OMV Routex, UTA and DKV.

Retailers, who were told the discount would be applied off invoice, have expressed anger and concern over the move.

Andrew Lawrence, who runs independent group Lawrences Garages (London) Ltd, said: “I’m very concerned about the loss of Allstar trade and the effect on profitability. I’m waiting for advice on what to do. I think most dealers will probably sign but a lot of dealers, like me, accept other cards and of course that’s something we have to consider.”

Paul Sykes, MD of Huddersfield-based Shaws Petroleum Ltd, said: “While I have no sympathy for Arval, it’s extremely worrying that we may lose 10% of our business. If we keep accepting Arval cards, we’ll need a separate system for swiping the cards etc. BP is saying it is our choice, but there are so many hurdles in place. I think Arval has left BP with very little choice - I just hope Arval can come to the table and discuss this.”

In a statement, BP said: “From 31st October 2008, Arval cards will no longer be accepted at BP operated sites. BP branded sites operated by independent dealers may still accept Arval cards after this date.

“The decision to end the relationship between BP Oil UK Limited and Arval after a long partnership was a particularly difficult one, but necessary in the current business environment.

“We apologise for any inconvenience this may cause to our customers and Dealers.

“Dealers should be aware that this action does not affect the acceptance of all other BP Fuel cards and in particular BP PLUS, BP PLUS Routex and BP Agency; these will continue to be accepted at all BP sites across the UK.

“Finally BP continues to be committed to providing for the fuel needs of our customers. Our longer term plans therefore reflect our commitment to our customers and Dealers over the long haul.”

*To find out more about the TotalCard which can be used at all BP branded sites as well as all TOTAL and 600 Shell sites with fuel available at wholesale prices , please visit http://www.forecourtfuelcards.co.uk/total-fuel-card.html or call 0845 450 4958

A company that specialises in manufacturing devices to prevent misfuelling has won a record investment from two of the country’s leading entrepreneurs.

DDN was awarded £250,000 to help market its Misfuelling Prevention Device (MPD) after appearing on BBC2’s Dragons’ Den after Deborah Meaden and Theo Paphitis teamed up to invest in the product.

The MPD is a retro-fit tube that replaces a vehicle’s existing fuelcap and prevents users from inserting a petrol nozzle into the cap of a diesel vehicle.

DDN is looking to increase its manufacturing capacity and aims to fit 83% of the new and used vehicle market.

Michael Cotton, managing director of DDN, explaining the reasons for installing the MPD, said: “The financial impact of mis-fuelling can be huge, costing between £250 and £12,500 to drain the tank and sort out the engine.”

DDN has successfully trialled its product on over 15 police fleets and Mr Cotton believes that fleets can play a major role in the growth of the business.

Despite the current record highs at the pump, half of small business fleets have taken no action to control or reduce their fuel bills.

A recent survey found that 49% of fleets that run 50 vehicles or less, have done nothing to help minimise the impact of spiralling prices.

And 29% of larger fleets that run over 250 cars and light commercials, have also taken zero action to control fuel bills.

The survey of over 500 fleet decision makers, which was conducted by Northgate Vehicle Hire, revealed that companies that had taken action were seeing positive results.

Measures taken included cutting unnecessary journeys, prohibiting drivers from using company vehicles for private use and ensuring meetings are only arranged when there is absolutely no alternative such as video-conferencing, tele-conferencing or simply a phone call.

Some fleet managers are encouraging drivers to check tyre pressures regularly, change to the highest appropriate gear as soon as possible, maintain a steady speed whilst using the highest possible gear and minimise the use of air conditioning which can increase fuel consumption by up to 10%.

Other measures include telematics to improve journey management. Over 20% of fleets are now using telematics to help control their vehicle movements.

Forecourt Fuels customers are currently experiencing savings of upto six pence a litre against the UK national average pump price by using a commercially priced Fuel Card. Contact Becky Bond on 0845 450 4958 or visit www.forecourtfuelcards.co.uk/further-info.html to receive details of how your business could take advantage of these savings.

Gordon Brown has defended a decision to postpone a 2p rise in fuel duty following suggestions by Conservative leader David Cameron that it was timed to coincide with next week’s by-election.

The prime minister said the decision, which comes as oil prices continue to hit new peaks, would benefit people facing high food and fuel bills.

But the Conservative leader enquired if it had “anything to do with the Glasgow East by-election?”.

Mr Brown said the timing was right to announce it before the Commons’ summer break.

The price of petrol and diesel has risen by more than 25% over the past year and pressure has been mounting for duty to be cut.

The announcement was made by Chancellor of the Exchequer Alistair Darling ahead of a Conservative-called debate on fuel duty set to take place in the Commons later.

During prime minister’s question time, Mr Cameron said: “The government announced today that after months of dithering it is scrapping the 2p tax rise on fuel.

“Can you tell us whether this decision had anything to do with the Glasgow East by-election?”

Mr Brown replied: “It is right to announce, as we have done previously, a decision before the House rises (for the summer break).”

He also said that the government would “continue to help hard-pressed families who are facing high fuel bills and high food prices because of what is happening in every country in the world….

“And in recognition of the problems that people face with petrol, we are freezing the duty of petrol for the full year. And we will bring forward further measures to help families in due course.”

The prime minister’s spokesman said there were “lots of precedents” for announcements on fuel duty to be made before the parliamentary summer recess.

He said Mr Darling “decided to do it now because he wanted to end any uncertainty”

But Liberal Democrat leader Nick Clegg warned a “winter of discontent” was “just around the corner” with jobs at risk and families struggling to cope with rising food and energy prices.

“You promised to abolish boom and bust. But now we’ve got both - inflation’s booming, the economy’s bust,” he told the prime minister.

Mr Brown said employment was at its “highest level ever” according to labour force statistics that were published last Wednesday and that inflation was lower than the rest of Europe and the US.

“We are taking action to help people through these difficult circumstances,” he said and urged Mr Clegg to “see the economy in its proper context”.

The RAC welcomed Mr Darling’s announcement, but said: “It does not go far enough. We would like to see the chancellor not just postpone future rises but actually cut fuel duty.”

AA president Edmund King said: “We are delighted that the chancellor has seen common sense. Many motorists have endured months of misery and this is a welcome piece of good news for them.”

Kate Gibbs, of the Road Haulage Association, said anything that assisted the road haulage industry was “good news” although the postponement of the fuel duty increase represented “quite a small drop in the ocean”.

However, Lib Dem treasury spokesman Vincent Cable said: “There’s absolutely no reason why the chancellor should have been stampeded into making this decision and we have no indication how it’s going to be paid for.”

The Institute for Fiscal Studies estimates today’s fuel duty decision leaves the Exchequer £550m worse off, and takes the overall cost of freezing fuel duty this year to £1.1bn.

The decision to postpone the rise was revealed in response to a parliamentary question tabled by a Labour backbencher.

Mr Darling told the BBC News Channel it was clear that oil prices were going to remain “high for some time yet”

“So I’ve reached the view that it’s right now, before the House of Commons goes away for the summer recess, to say that we’re going to postpone the increase that was due in October,” he said.

“I’ll look again at the matter again in the budget but I think that this is the right thing to do to help motorists and to help businesses.”

It follows a series of demonstrations by truckers demanding cheaper diesel. Figures show petrol prices have risen nearly a quarter during the past year, and diesel 36%.

AA figures suggest the cost of a litre of unleaded petrol averaged 119.5p across the UK on Tuesday, with diesel averaging out at 133p.

Fuel duty increases have been postponed on a number of occasions over recent years when oil prices have risen sharply.

Availability of biofuels in the future has been thrown into doubt following the publication of an independent review of the Government’s biofuel plans.

The review found that the Government’s target that 10% of all transport fuels must be biofuel by 2012 is too ambitious and needs to be revised down.

There has been a huge backlash against biofuel, with charities and NCOs accusing producers of destroying rain forests to grow the biofuel crops coupled with switching production from food to fuel crops.

Campaigners such as Friends of the Earth claim that this has, in part, led to the surge in world food prices.

Now the Renewable Fuels Agency’s review into the indirect effects of biofuel production, which was led by Professor Ed Gallagher, has said the Government must slow the introduction of biofuels until effective controls are in place to prevent land use change and higher food prices.

However, it also found that there is a future for a sustainable biofuels industry but creating the correct policy framework is “challenging and will take time”.

The report also warned that current policies, if left unchecked, “will reduce biodiversity and may even cause greenhouse gas emissions rather than savings”.

It also stated that the increasing demand for biofuels has contributed to the rising prices for some food commodities, notably oil seeds, which is having “detrimental effect on the poor”.

It recommends that whilst there is a place for biofuels, production must target idle and marginal land and the use of wastes and residues.

This would then avoid indirect land use change and reduce competition with food, it said.

Professor Gallagher said: “Our review makes clear that the risks of negative impacts from biofuels are real and significant, but it also lays out a path for a truly sustainable biofuels industry in the future.”

However, his recommendations do not go far enough, in the view of Friends of the Earth.

The charity has urged the Government to reconsider its biofuels obligation altogether, rather than just “tinkering” at the margins.

“Feeding cars instead of people pushes up food prices and fuels deforestation,” said Friends of the Earth spokesman Kenneth Richter.

“If we want to quit our expensive and damaging fossil fuel habit we need a new direction in transport - not a quick fix from biofuels.

“Instead of chasing the pipe dream of alternative fuels, the Government must ditch these targets and start helping Britons save petrol and cut emissions now.”

Trade show will focus on sustainability and future feedstocks.

Rather surprisingly, the Gallagher report received a warm reception from the biofuels industry.

“Far from being bad news for the industry, the report confirms that biofuels have their role to play, but we must proceed with caution and make sure that biofuels are made from sustainable sources,” said Richard Price, director of Biofuels Media.