Diesel prices could rise by 50%
31 March 2008
- Marine shipping threat
- Industry needs lower emissions
- Demand could send prices soaring
Diesel prices could rise by up to 50% if proposals by the merchant shipping industry to switch to the fuel are approved.
That could push prices at the pump up to £1.73 per litre, or £7.84 a gallon.
The shipping industry is under pressure to switch from marine fuel, which results in high sulphur dioxide emissions, to a less-polluting power source.
Although diesel is less polluting and easily useable in current marine engines, fears are growing that if the industry switched, the demand created would send diesel prices soaring.
Estimates suggest that the entire shipping industry would consume one-and-a-half times the amount of diesel currently used by European motorists, equivalent to double the annual oil production of Saudi Arabia.
As a result of the increased demand, estimates suggest that all oil prices would increase by 50%.
Robert Clarke, spokesman for the Technology for Sustainable Shipping Group, said: 'It is not a cost-effective way to improve the environment.
'The impact on the oil market alone would likely more than double the cost of marine fuels and substantially increases prices of diesel, aviation jet fuel and heating oil on land.'
The International Maritime Organization (IMO), the UN agency responsible for preventing pollution from ships, is currently discussing the proposals.
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