£2 a litre – WTF! Diesel now hitting £2 a litre – that’s £9 a gallon in old money. Is this now classified as liquid gold ?
This year, the Iran war has caused the price push due to disruptions in the production and transportation of oil from the country. The Russian – Ukrainian conflict has further impacted supplies of diesel to the world market. Countries such as China and the USA have also restricted or are considering restricting exports of refined fuels. The G7 nations last week agreed at a meeting to release 100 million barrels of oil to head off further price increases.
The knock-on effect has been a drop in diesel vehicle sales and more people now are considering changing to an EV motoring solution. Is the current pricing of the fossil fuels just the beginning or are there worse times to come with the costs going forward only to rise ? There is of course the forthcoming hike in the price of supplied electricity to consider. Charging your car will therefore be more expensive next year. And what about the policies of many companies encouraging their employees to attend the office more days per week – a two-fold rise in commuting costs.
Haulage and delivery firms’ costs are suffering immediately with the rising fuel pricing. These increases will need to be passed on to the suppliers of the goods being transported. This in turn will cause a rise in prices to the consumers and purchasing businesses of these products.
Could the rise in fuel stabilise the current prices asked of second-hand electric vehicles ? Whilst depreciation is said to be around the 38% to 42% rate after three years, will the depreciation rate reduce and the demand in used EV’s nudge their asking prices higher? There is always that worry on consumers’ minds regarding the shelf life of the EV’s batteries. Clearly an expensive payout for a new set of batteries if required. Does that mean that high mileage, high usage EV’s with limited remaining battery efficiency become worthless on the market ?
If you currently own a diesel vehicle, how easy will it be to sell it on in light of the decline in demand ? What will be its worth now or next year? My daily VW SUV is diesel powered and I have been toying with going electric for a while now. The blocker currently is the price of the new EV’s. It’s a large chunk of sterling and then you have the depreciation factor. The alternative would be to lease one over three or four years and have the set monthly payments. I do not particularly want a new car though, and the second-hand EV examples look attractive. But you are then restricted to available leasing options. Financing instead will obviously incur the associated interest rates on the credit given. A first world problem I know. It’s nice to have such a huge choice of vehicles to purchase today but somehow it seemed easier with less options thirty years ago. But then for most products and services back then, the choice was smaller than today and we still had the dilemma of choosing the correct option. Going forward we need the hydrogen fuel cell technology to become cost effective or maybe the flux capacitor to go into production to assist our vehicles…
