Unleaded Petrol (Hansard, 24 February 1992)

§ 4. Mr. Hague
To ask the Secretary of State for Energy what is his estimate of the current level of unleaded petrol sales in the United Kingdom; and what comparable figures he has for EC member states.

§ The Parliamentary Under-Secretary of State for Energy (Mr. Colin Moynihan)
Unleaded petrol sales in the United Kingdom currently account for nearly 44 per cent. of all petrol sales. The United Kingdom Petroleum Industry Association estimates that in 1990 the market share of unleaded petrol in other European Community countries was as follows: unified Germany 71 per cent., Denmark 58 per cent., Netherlands 49 per cent., Luxembourg 32 per 668 cent., Belgium 27 per cent., Eire 20 per cent., France 14 per cent., Italy 5 per cent., Greece 3 per cent., Spain 1 per cent., Portugal 1 per cent. The comparable United Kingdom figure for this period was 34 per cent.

§ Mr. Hague
Does my hon. Friend agree that those figures reflect a sharp improvement in this country over the past few years and scope for some of our Community partners to do more to encourage unleaded petrol sales? Does my hon. Friend expect that unleaded petrol sales in Scotland would improve if the petroleum engineering directorate were relocated to Aberdeen?

§ Mr. Moynihan
My right hon. Friend the Secretary of State is to announce today that he is appointing Ernst and Young management consultants to undertake an independent study of the case for and against relocating the Department of Energy's petroleum engineering directorate to Aberdeen. Whatever the findings on relocation, there may well be an impact on the level of unleaded petrol sales in Scotland and thus in the United Kingdom.

§ Mr. Simon Hughes
As the Minister's first answer made it clear that a price differential has been a major cause of the substantial increase in sales of unleaded petrol, and as the Secretary of State is on record as saying that the market has a role to play in cutting the use of petrol across the market in the United Kingdom, by what figures does the Department currently estimate that petrol prices will increase over the next few years?

§ Mr. Moynihan
As the hon. Gentleman knows, we are not in a position to predict what oil prices or, through oil prices, petrol prices will be over the next few years. On the hon. Gentleman's first point, there is no doubt that the duty differential in favour of unleaded petrol has been an important catalyst for the increased take-up of unleaded petrol, but the need for further changes to the duty differential is, as the hon. Gentleman knows, a matter for my right hon. Friend the Chancellor.

§ Mr. Mans
Although those figures are very encouraging, does my hon. Friend agree that an awful lot of older vehicles could be converted to run on unleaded petrol but that people are ignorant of that fact? Will my hon. Friend therefore consult his colleagues at the Department of Transport to see whether it is possible for notices to be sent with car tax reminders, indicating whether certain vehicles could be easily converted to run on unleaded petrol?

§ Mr. Moynihan
My hon. Friend makes a very imaginative proposal. I will certainly pass it on to my right hon. and learned Friend the Secretary of State for Transport. My hon. Friend will know that more than 200,000 free information booklets have already been distributed, which answer questions about unleaded fuel and provide contact numbers for the main car manufacturers. Seven out of 10 cars on the road are capable of using unleaded petrol, but we need to press on and go further.

§ Mr. Win Griffiths
Having admitted that the lower duty on unleaded petrol has helped to promote its use, has the Minister had any discussions with the Treasury about introducing such a lower level of duty for the cleaner diesel fuels which are now available, especially as BP is one of the pioneers in that respect?

§ Mr. Moynihan
The answer is no—not least because diesel prices are determined by the market. I accept that, at present, they are high—only slightly below unleaded petrol prices—but, as the hon. Gentleman knows, that is because the demand for gas oil, which is equivalent to diesel, is high at this time of year as it is used for heating and high demand tends to push up prices. However, I expect the differential between unleaded and diesel to revert to the norm in the summer months.