With so much talk about Brexit, and the prospect of a “No Deal” scenario looming large, EL Oils would like share some of our research as to how this may affect the oil and lubricant industry and where our customers can go to get additional advice on how to get their business Brexit-ready.
In August 2019, a confidential government document was leaked outlining the stark terms the UK would face in the event of a no deal Brexit, including warnings on fuel shortages.
The document sets out plans to help cope with these possible eventualities but its plan to avoid fuel shortages could only compound the problem.
Currently UK fuel export tariffs are set to rise to 4.7%, but the government set out plans to cut fuel import tariffs to 0% in the event of a no deal Brexit. This is to avoid any sudden cut off but oil refineries are warning this would put them at a competitive disadvantage.
The leaked government document predicts that the increased export tariffs will result in two of the country’s six oil refineries being shut down. The UK exports about 30% of what its refineries produce.
A report commissioned by Oil & Gas UK in 2017 concluded that WTO tariffs taking effect in the event of a no-deal Brexit could add around £500 million (€547 million) to the cost of oil trade.
The information we have provided here is based on a “worst-case scenario”, whereby Britain crashes out of the EU without a deal, and becomes a “third country” with absolutely no trade agreements in place with the EU. However, should a deal be reached, we cannot predict what changes will be implemented as this will be subject to negotiations between Britain and the EU.
We want to reassure all of our customers that EL Oils are committed to offering you the very best quality products at competitive prices. We are proud to work in partnership with our clients and will continue to do so. At the moment it is a case of prepare for the worst and hope for the best.
Get yourself ready for Brexit and click here to catch up on the most up to date things your business needs to do to prepare. In the meantime, should you have any questions please feel free to contact us on 01543 252301.