U.K. Oil Firms Say Fuel Crisis Easing as Government Steps In
(Bloomberg) -- The U.K. oil industry said the nation’s fuel crisis is easing after the government deployed additional tankers and put the army on standby to drive trucks.
After days of chaos, with long lines of desperate motorists blocking traffic and provoking fights at fuel pumps, the government appeared to be getting a grip on the situation. At the height of the crisis, more than half the country’s petrol stations had run dry, leaving businesses and key workers unable to do their jobs.
While some drivers were still experiencing difficulties finding fuel, and long waits to purchase it, suppliers said on Wednesday that there are “signs that the situation at the pumps has begun to improve.”
“We remain confident that the situation will stabilize further in the coming days,” companies including BP Plc, Royal Dutch Shell Plc and Exxon Mobil Corp. said in a joint statement.
Earlier in the day, the U.K. government said it was deploying its reserve tanker fleet to ease the crisis. Around 150 Army drivers will be used within “days” to help boost deliveries, Business Secretary Kwasi Kwarteng said.
The fuel suppliers said in the statement that they met with Kwarteng on Wednesday and “continue to work closely with the government to maintain regular deliveries of fuel.”
The government’s 80-strong reserve tanker fleet will help to resolve the fuel shortages, despite a lack of drivers being at the root of the crisis, said a person familiar with the matter. Haulage companies have recalled drivers from leave and are at surge capacity, meaning some operators now have more drivers than tankers, the person said.
Beyond those short-term measures, there is still an industry-wide shortage of qualified workers for the haulage industry. Hoyer, which delivers fuel for customers including BP, said it is short 50 drivers for its trucks.
Of the 150 Army drivers placed on standby, about half would be able to deploy this week if needed, with the others requiring more training, government officials have said.
The number of fuel stations without stock fell to about 27%, from 37% a day earlier, the U.K. Petrol Retailers Association said in an emailed statement. “We are expecting to see the easing continue over the next 24 hours,” said Gordon Balmer, the PRA’s Executive Director.
“The situation clearly is stabilizing,” Kwarteng said. “If we look at the inflows, the deliveries of petrol, they were matched yesterday by the sales.”
Stocks of fuel at the U.K.’s service stations are never at maximum capacity, and in normal times are 46% full, said the person familiar with the matter. Last week, storage levels declined every day, reaching a low of 10% at the weekend, before increasing in the past two days, the person said said, declining to say what the current level is.
London taxi drivers said the availability of fuel was still is far from normal.
“The situation is absolutely no different today as it was earlier this week,” said Steve McNamara, General Secretary of the Licensed Taxi Drivers Association, which represents half of the 22,000 drivers of London’s iconic black cabs. “Most fuel sites are shut, those that are not shut are very few and far between, have enormous queues, have all the fights and all the arguments and that kind of stuff.”
Ministers have been struggling to show they have a handle on frequent ructions in the supply chain, of which the fuel shortages are just the latest example. During the pandemic, supermarket shelves have been left bare amid an estimated 100,000 shortfall of truck drivers.
Johnson’s opponents have blamed the Brexit deal he signed with the European Union for cutting the U.K. off from the bloc’s seamless labor market, a narrative the the prime minister has rejected.
By bringing in the Army, the government is trying to end the chaos and the attention on Brexit it has fostered. It is also a calculation that the dramatic image of soldiers in fuel trucks will be less damaging politically than appearing to allow the crisis to drag on.
“We are working closely with industry to help increase fuel stocks and there are now signs of stabilization in the forecourt storage,” a spokesperson for the government said. “We have ample fuel reserves and remain confident the situation will improve in coming days. The sooner we can all return to our normal buying habits, the sooner the situation will return to normal.”
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