IRU — 2025-01-28
News from Brussels
We turned to Global Petrol Prices for insights into key trends and projections.
Fuel prices significantly affect the total cost of ownership for heavy-duty vehicles, making accurate forecasts essential for road transport operators and businesses.
We asked Neven Valev, a leading expert at Global Petrol Prices (GPP), to give us an overview of the 2025 outlook and the factors driving diesel price variations across countries.
Why do diesel price changes vary by country?
GPP: Two main factors drive diesel price changes across countries: oil prices and government policies.
Essentially, all countries face similar crude oil price changes. But their diesel prices respond in very different ways. For example, a 10% change in oil prices causes a 7% change in diesel prices in the US, while in Germany, it leads to a 3% change.
The same goes for regulated markets, which account for over 60% of the world. The effect can vary widely in magnitude and timing.
The extent and type of fuel market policies and regulations, as well as the level and kind of taxes and fees, explain the different reactions. In most countries, taxes make up a significant component of the price at the pump.
What are the latest oil price projections?
GPP: At the end of 2024, oil prices were expected to continue their gradual decline, averaging $73 per barrel in 2025, down from $79 in 2024, and decreasing to $68 in 2026.
However, as we noted in our latest forecast, that projection came with important caveats about geopolitical tensions. Just two weeks into 2025, Brent crude oil prices reached $80 as US sanctions on Russian oil exports were stiffened.
Hence, while the general trend is downward, large fluctuations can be expected. Brent crude oil prices could potentially near $100 per barrel. Conversely, oil-producing countries could increase output to gain market share, particularly as oil consumption trends downwards. This, coupled with potential trade restrictions from the US, may result in Brent oil prices under $60 per barrel by 2026.
What does that mean for diesel prices inmajor economies?
GPP: In the $60 to $100 per barrel oil price range, diesel prices are projected to vary significantly:
The ranges are substantial and underline the importance of scenario planning.
Final thoughts on the effects of large shocks?
GPP: Significant oil price shocks, like those in 2022, tend to magnify price disparities across countries due to variations in diesel price responsiveness.
Increased government intervention often follows, shifting markets from liberalised to more regulated policies. This amplifies both price uncertainty and country-specific differences.