Jersey Businesses Concerned Over Impact of Rising Fuel Costs

Businesses in Jersey are expressing unease over the escalating global fuel prices, which have led to diesel costs exceeding £2 per litre. While the Government of Jersey has proposed a fuel duty freeze for 2027 to alleviate cost-of-living pressures, some companies fear it may not be enough to offset the sustained rise in global rates. The government's proposed budget for 2027 includes freezing fuel duty, a move previously implemented for 2023-2025, before an inflation-linked rise in 2026. The stated aim is to "help avoid additional costs for households and businesses that rely on transport, providing continued support at a time when many islanders remain under financial pressure."

However, companies like A&A Scaffolding Solutions report that rising diesel prices are a significant concern, compounding other increasing operational costs. "Construction is taking a hard hit," stated Kelly Keating from the company. "We rely on diesel for machinery, vehicles and deliveries, so increases put direct pressure on the cost of carrying out work." Keating added that alongside rising material, freight, and operating costs, this situation is "squeezing margins and making it harder to price projects with confidence." The company's worry is that a fuel duty freeze offers "limited relief if global fuel prices continue to rise," and that the "cumulative impact" of these increases could eventually affect business investment and customer pricing.

Tree surgeons also report a "noticeable impact" from higher fuel costs. Darren Hopkins of Jonathan Le Maistre Ltd. explained that their operations, including vans, trucks, chippers, and stump grinders, are fuel-intensive. "Increased diesel prices will raise our operating costs, reducing margins on jobs and making it more difficult to absorb costs without passing some of them on to our customers," Hopkins said, noting that continued increases would be a concern for their business and the wider industry.

Some businesses are implementing measures to cope. Jeremy Phillips of Barette Plant Hire mentioned that fuel surcharges are being added to hourly rates. However, Phillips cautioned that sustained price hikes could deter customers from proceeding with their projects.

Treasury Minister Alan Maclean defended the government's approach, stating that the budget prioritizes targeted support for consumers rather than expecting businesses to absorb costs. He argued that reducing fuel duty was not considered the most effective method because it "wasn't targeted." Instead, the proposed freeze is intended to "mitigate the impact of prices rises by reducing the level of duty in real terms." Maclean emphasized that fuel prices are largely influenced by global markets and geopolitical events outside Jersey's control, and the government's role is to "avoid adding further pressure where it can."