Red diesel prices fall back below 70p/litre
© Tim Scrivener Farm businesses may be able to capitalise on lower red diesel prices at present, as prices fell back during December following a dip in global crude oil markets.
Prices collected by Farmers Weekly put red diesel 66.5p/litre in mid-December, down 11% on month-earlier levels.
Brent crude oil fell below US$60 (£44.60) a barrel for the first time in almost five years during December, before lifting marginally.
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Market fundamentals remain weak, with global supplies outweighing demand, but global geopolitics has led to some volatility in prices.
The Organisation of the Petroleum Exporting Countries (Opec) says the main growth drivers for supplies in 2025 were the US, Brazil, Canada and Argentina.
Looking ahead, Opec forecasts that oil supplies will increase across Latin America, Canada and the US.
Meanwhile, global oil demand is forecast to rise by 1.4m barrels/day in 2026.
Attacks on Russian oil refineries, trade sanctions and US blockades of Venezuelan oil tankers have caused recent fluctuations in the market, according to Louisa Beasley of Worcestershire-based fuel supplier Callow Oils.
However, she said despite this volatility, red diesel was effectively 5p/litre cheaper than at the beginning of the month.
Ms Beasley said it was going to be very difficult to make forecasts, particularly in the UK.
“The fact that the Immingham refinery [on Humberside] has closed down hasn’t really impacted upon UK stocks to date,” she said.
“At some point we are confident it will do, because it was pretty much a third of the UK product, which now has to be sourced from elsewhere.”
Oilseeds market
The wider oilseeds complex has also been affected by falling crude oil prices, with downward pressure being placed on both global and domestic oilseed rape prices.
Delivered oilseed rape was trading at £410/t on 22 December, down £20/t on month-earlier levels.
Traders at United Oilseeds suggested that lower crude oil prices were having a negative impact on oilseeds markets, with Brent crude in December reaching its lowest levels since February 2021.
Ample global supplies have added further pressure on oilseeds, with large crops expected in Australia and Brazil.