UK business & economy updates
Sign up to myFT Daily Digest to be the first to know about UK business & economy news.
At least half of UK petrol stations outside of the motorway network have run out of fuel after Britons engaged in panic buying in response to disruption to fuel supplies caused by a lack of tanker drivers.
Brian Madderson, chair of the Petrol Retailers Association, a trade body, said a survey of members on Sunday indicated 50 to 85 per cent of all independent service stations had now run dry, excluding motorway forecourts and some supermarket sites that have been prioritised by oil companies.
Madderson said what had been a “manageable issue” of localised shortages at a small number of retail sites last week had quickly spiralled after media reports of supply problems had set off panic buying by motorists, with some members stating demand had surged “500 per cent above the normal level” on Saturday, quickly draining forecourt fuel tanks.
The UK has about 8,000 petrol stations, and the majority are run by independent retailers, some of whom operate franchises using the big oil companies’ brands.
Madderson told the Financial Times that while the short-term issue was “panic buying”, the root cause was “a government that’s been dragging its feet over the issue of the number of haulage drivers on the ground”.
Ministers bowed to business pressure on Saturday and announced they would issue temporary visas to 5,000 foreign heavy goods vehicle drivers to help tackle major labour shortages in the logistics industry.
The government move came after panic buying followed BP saying last week that as many as 100 service stations had been disrupted and several forecourts closed because of a shortage of tanker drivers.
Grant Shapps, transport secretary, on Sunday urged people to be “sensible” and said there was plenty of fuel at Britain’s six refineries and 47 storage facilities.
“The most important thing is that actually people carry on as they normally would and fill up their cars when they normally would, then you won’t have queues and you won’t have shortages at the pump either,” he told Sky News.
But the government’s appeals to the public to exercise restraint were not enough to halt a rush to petrol stations by motorists spooked by warnings that oil companies may need to restrict deliveries due to a lack of HGV drivers.
Long lines could be seen at many service stations at the weekend. BP, which operates one of the UK’s largest fuel networks, including many motorway sites, said on Sunday that it estimated 30 per cent of its branded service stations “do not currently have either of the main grades of fuel”.
The business department announced on Sunday evening that it would temporarily exempt the industry — including producers, suppliers, hauliers and retailers — from the Competition Act of 1998, allowing them to share information and prioritise deliveries to areas of greatest need.
“While there has always been and continues to be plenty of fuel at refineries and terminals, we are aware that there have been some issues with supply chains,” said Kwasi Kwarteng, business secretary.
He said the so-called Downstream Oil Protocol would ensure the industry could share vital information and work together to minimise disruption.
BP and Royal Dutch Shell, which also operates a large fuel network, both said that they were working flat out to replenish supplies.
But industry insiders said there was little that energy companies could do when faced with panic buying, beyond waiting for it to fizzle out.
Shell said it was replenishing sites that ran out “quickly, usually within 24 hours”.
BP said: “We continue to work hard with our haulier supplier, Hoyer, to optimise fuel distribution and to minimise the level of disruption.”
The scenes of petrol stations running dry have increased the pressure on the government, which is also grappling with energy suppliers collapsing following a surge in wholesale gas and electricity prices.
Households are braced for much higher energy bills — one of several factors that has prompted warnings of a cost of living crisis this winter.
Madderson welcomed the government’s plans to ease visa requirements for foreign workers but said the biggest problems were at the Driver and Vehicle Licensing Agency, a branch of the Department for Transport, where there was a significant backlog of lorry driver applicants looking to start training.
“Getting the DVLA sorted out is a number-one priority,” said Madderson.
Industries that are heavily reliant on fuel supplies said there were growing fears for what would happen in the coming days.
Steve Wright, chair of the Licensed Private Hire Car Association, a trade body, said he had asked the transport department to grant emergency-service status to licensed vehicles, which would give them priority access to fuel.
He added that fuel shortages would have a “catastrophic effect” as private hire vehicles were heavily used for transporting hospital patients and disabled students.
Additional reporting by Nic Fildes and Jim Pickard