Would the UK cope if we stopped the import of Russian oil and road fuels? The issue is becoming a topical one as pump prices rise ever higher on the back of Russia’s invasion of Ukraine.
The UK has already said that it won’t allow Russian-registered or Russian-owned ships to dock in the UK, and has now announced a phased-in ban of Russian oil and refined fuels through 2022.
Pressure has been growing internationally, with the U.S. also investigating a ban and Shell announcing it would close Russian fuel stations, as well as apologising for its recent decision to buy a cargo of Russian crude on the cheap.
A ban sends a strong signal to Russia but comes at a cost. Russia is our biggest source of diesel outside the UK, supplying 18% in 2020 but hovering around 15-20% annually, according to UK-based fuel delivery and trading company Portland Fuel. In 2020, we imported around half our diesel needs, and a third of that – about 4.1 billion litres – came from Russia, according to HM Revenue and Customs (HMRC) trade statistics.
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Last year, we paid Russia just under £3 billion for ‘refined fuels’ (largely diesel), according to the Office of National Statistics, which didn’t break down the fuel types.
Our second largest supplier of diesel is the Netherlands, which buys around a quarter of its crude oil from Russia.
Last year, we paid the Netherlands £2.1bn for ‘refined fuels’, of which, going on the 2020 breakout from HMRC, a third of which was diesel. Unsurprisingly, perhaps, Dutch prime minister Mark Rutte is also cool on the idea of an oil and fuels ban.
We also imported four million tonnes of crude oil from Russia in 2020, which was around 11% of our crude import total, according to HMRC. In total, around 60% of Russia’s oil exports go to Europe, according to the International Energy Agency.
We're in an “unprecedented” situation, according to one industry analyst who declined to be named. “Russia produces a lot of diesel for a lot of Europe, so the markets would have to readjust,” he said.
The shortage of diesel means it’s already pulling away from unleaded in the alarming rise of pump prices. As of 6 March, the average diesel price was 161 pence per litre against 156 pence per litre for unleaded, according to the RAC. However, motorists are seeing much bigger gaps than that.