9. OIL
As for oil demand by fuel type, diesel is the most used oil product in the United Kingdom at 33% of the total oil demand in 2017 (up from 25% in 2007), followed by jet fuel and kerosene and motor gasoline (Figure 9.6). The share of motor gasoline has fallen from 23% in 2007 to 18% in 2017 as car owners switched to diesel vehicles and vehicle efficiency increased.
In July 2018, the government announced its intention to prohibit the sale of new petrol and diesel cars and vans by 2040 (and at least 50% of that target to be reached by 2030) as part of its air quality plan. It will have a large impact on the future trend of oil product consumption, which is currently dominated by transport-related fuels.
At the end of 2016, the International Maritime Organization (IMO) confirmed that, from January 2020, ships would have to use marine fuel with a sulphur content below 0.5% compared to the current 3.5% limit. The implementation of the IMO’s new marine fuel specifications will also affect the oil product mix of the country. As an island nation, shipping and the maritime sectors are among the most important industries to the UK economy. Oil used for international marine bunkers was 2.5 Mt (47 kb/d) in 2017 (which excludes 3.8 Mt or 71 kb/d in Gibraltar).
Figure 9.6 Oil demand by product, 2007 and 2017
|
2007 |
|
|
2017 |
|
|
|
Residual |
Other |
LPG* and |
|
Residual |
Other |
LPG* and |
|
fuels |
products** |
ethane |
|
fuels |
products** |
ethane |
|
5% |
8% |
8% |
Naphtha |
2% |
8% |
9% |
Naphtha |
Other gasoil |
|
|
2% |
Other gasoil |
|
|
2% |
|
|
|
|
|
|
||
9% |
|
|
|
8% |
|
Motor |
|
|
|
|
|
|
|
|
|
|
|
Motor |
|
|
|
gasoline |
|
|
|
gasoline |
|
|
18% |
|
|
|
|
23% |
|
|
|
|
|
|
Diesel |
|
|
Diesel |
Jet and |
|
|
|
Jet and |
|
kerosene |
|
|||
|
25% |
|
|
33% |
20% |
|
|
|
kerosene |
|
|
|
|
|
|
|
|
20% |
|
|
|
|
|
Diesel alone accounts for 33% of the total oil demand, followed by jet fuel and motor gasoline.
*LPG = liquefied petroleum gases.
**Other products include bitumen, lubricants, petroleum coke, refinery gas, white spirit, paraffin waxes, aviation gasoline, and other undefined oil products.
Note: Includes international aviation, which is not included in Figure 9.5.
Source: IEA (2018b) Oil Market Report 2018, www.iea.org/statistics/.
Retail market and prices
The United Kingdom operates an open market in which the wholesale price of petroleum products is set by market dynamics. The government influences retail prices for consumers solely through taxation.
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9. OIL
Figure 9.7 Oil fuel prices in IEA member countries, Q4 2018
Automotive diesel fuel
2.5 |
USD/L |
Tax component |
|
|
|
2.0 |
|
|
1.5 |
|
|
1.0 |
|
|
0.5 |
|
|
0 |
|
|
Premium unleaded gasoline (95 RON)
3.0 |
USD/L |
Tax component |
|
|
|
2.5 |
|
|
2.0 |
|
|
1.5 |
|
|
1.0 |
|
|
0.5 |
|
|
0 |
|
|
Light fuel oil
2.5 |
USD/L |
Tax component |
|
|
|
2.0 |
|
|
1.5 |
|
|
1.0 |
|
|
0.5 |
|
|
0.0 |
|
|
The United Kingdom has one of the highest retail prices for diesel oil with high taxes among the IEA member countries, while it has the third lowest price for light fuel oil.
Notes: Data are not available for gasoline in Japan and for light fuel oil in Australia, Hungary, Mexico, New Zealand, Slovak Republic, and Sweden. RON = research octane number.
Source: IEA (2019b), Energy Prices and Taxes 2019, www.iea.org/statistics/.
172
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