Fuel prices (TERM 021) - Assessment published Dec 2013
The price of fuel in the EU, including the cost price, excise duty and VAT. Prices are in Euros per litre.
- ‘All petrol’ is a consumption-weighted average price of both leaded and unleaded fuel, corrected using energy-content to the equivalent amount of unleaded petrol.
- ‘All fuel, unleaded petrol equivalent’ is a consumption-weighted average price of unleaded, leaded petrol and diesel, corrected using energy content to the equivalent amount of unleaded petrol.
- ‘Nominal’ is the price with no adjustment for inflation.
- ‘Real’ is the price corrected for inflation, using 2005 as the baseline year.
- ‘Average, all fuel, unleaded petrol equivalent (real, weighted by consumption)’ is the consumption-weighted average of the ‘All fuel, unleaded petrol equivalent (real)’ line across the full time series.
Fuel prices used include the cost price, excise duty and VAT. The units used are Euros per litre.
Key policy question: Are fuel prices sending the appropriate signals?
Since 1980 the real price of transport fuel (all transport fuels, expressed as the equivalent consumption in unleaded petrol, corrected for inflation to 2005 prices) has fluctuated between EUR 0.75 and 1.25 per litre, with an average of EUR 0.96. Real prices per litre peaked in July 2008 at around EUR 1.25, but then fell by around a third later that year, largely due to a significant drop in the price of crude oil. Another peak occurred in April 2012 when fuel prices reached EUR 1.24. Since then fuel prices have fallen again. The average real price in May 2013 was EUR 1.14 – still significantly above the long term average of EUR 0.96. The price of fuel is an important determinant of the demand for transport and the efficiency with which fuel is used. However, despite rising real prices over the last two decades transport demand increased.