HVO Renewable Diesel
Red diesel, or commercial gas oil, is very similar to ordinary road diesel (known as DERV, or Diesel Engine Road Vehicle), except that a red dye component is added to the fuel. This doesn’t cause any damage, but it stains the tank and marks the vehicle as using red diesel. The reason for the distinction is that red diesel has a reduced duty rate and can only be used for certain purposes.
Red Diesel Prices UK
Red diesel prices can be subject to significant change, so it’s important to stay on top of what the prices are when you are buying. However, as red diesel is taxed differently from DERV, it can be more difficult to track its price.
To find our most recent red diesel prices, please contact our team for a quote.
What Affects Red Diesel Prices?
Numerous factors can affect red diesel prices in the UK, particularly as the UK must import much of its diesel from overseas. Two factors that were particularly prominent over 2020 and 2021 were the supply and demand ratio and the price of crude oil. As the Covid-19 pandemic threw countries around the world into lockdowns, with furlough schemes and stay-at-home orders, demand crashed and the price of crude oil made the largest drop in history. Inevitably, this had a knock-on effect on oil products – including the price of gas oil.
However, these are not the only deciders of red diesel prices. Some of the other elements that might impact the price of gas oil include:
· VAT rates
· Exchange rates
· Costs of refinement
· Barriers to access – inclement weather, conflict or natural disasters can elevate oil prices.
· The Organisation of the Petroleum Exporting Countries (OPEC), which acts in the interests of stabilising the oil market with its member countries.
Changes to Red Diesel Prices
From April 2022, the laws surrounding the use of red diesel are changing. As part of the UK government’s plan to end its contributions to global warming by 2050, the list of legal uses for red diesel is being greatly reduced. This means that many current users of red diesel will have to switch to road diesel and pay the relevant duties, thereby incentivising a change to greener fuels or a reduction in the amount of fuel used.
You can learn more about the changes to red diesel tax on our website.
If you would like to learn more about our red diesel prices or would like to order red diesel for your business, please get in touch with our team today.
Red Diesel FAQ's
Red diesel is a form of rebated fuel, meaning that it carries a reduced duty rate, meaning red diesel prices include 40% less fuel duty than users of DERV. In the past, this has made red diesel an attractive option to businesses in many sectors, but the changes to the law in 2022 will limit who can use red diesel. This will increase the price of gas oil for many and discourage its use.
The red dye in red diesel is used as a marker to signify that the correct amount of tax or duties have been paid. As red diesel is not subject to the same fees as regular diesel, it can only be used in certain industries or for certain purposes. The dye makes it easy for police or customs officers to check that it is not being used illegally.
Typically, no – if you need red diesel, you will usually need to order it from a specialist fuel retailer like Rix. Some petrol stations offer it, particularly in more rural areas, but the majority do not.