London, UK: Diesel rationing is a strong possibility after Russia’s invasion of Ukraine, a Treasury select committee was told yesterday.
Amrita Sen, a founding partner and the chief oil analyst at the research consultancy Energy Aspects, told the committee that diesel was likely to be rationed in Germany before the end of March and that the same could happen in the UK.
Sen said that while the UK gets relatively little crude oil and gas from Russia, about 18% of diesel imports came from Russia in 2020.
“Consumers need to get ready for continued rises in fuel prices,” said Nathan Piper, the head of oil and gas research at Investec bank.
Asked about how high the cost of fuel could go, he said: “Not to be flippant but pick a number.”
Piper said industry would probably take the brunt of any rationing but stressed that the impact would be felt more widely. “Diesel runs the world,” he said. “Diesel runs the shipping lanes, the trains, the cars, everything.”
Sen, Piper and Tony Danker, the director-general of the business lobby group the CBI, all said the UK would have to embrace greater investment in North Sea oil and gas as a stopgap alongside renewables.
Piper argued against suggestions that rethinking a ban on fracking may help the UK achieve energy security and bring down gas prices, calling it a “red herring.”
