One of the highlights of the recent Budget was the reduction in the rate of fuel duty and cancellation of the fuel duty excalator. At a time when costs are proving to be a challenge for many drivers and businesses, pressure had mounted on the Chancellor to provide some respite and he responded.
While the reduction in duty is something to be welcomed, it doesn’t mean that fuel management isn’t still a priority; now is not the time to rest on your laurels. Fuel remains one of the biggest vehicle related costs and UK pump prices remain high. The upshot is that you should be managing fuel just as tightly now as you were pre Budget, otherwise your costs will escalate.
As a starting point, this means getting a handle on what you are spending currently so that you can pinpoint areas for cost reduction. To do this, we would always advocate the use of fuel cards and once you have this information, a simple way of reducing costs is to plan where you, or your drivers, purchase it from.
The price at different sites within an area can vary by several pence per litre, and so understanding which sites are providing good value and refuelling there, can make a significant difference to your annnual bill.
Looking ahead it seems pretty clear that the price of fuel will remain volatile impacted by geopolitical events and changes to the supply, demand balance, and let’s not forget that we are due two fuel duty increases in 2012!
So embrace the reduction in duty, but don’t rely on it. Irrespective of the pump price, fuel costs are something that you should manage closely, and with prices still high, there has never been a better time to take a prudent approach.
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