Jersey businesses warn fuel costs squeeze margins as diesel tops £2

Businesses in Jersey have voiced concern about the effect of rising global fuel prices on their margins, after diesel prices in the island and the UK recently topped £2 per litre. The Government of Jersey has proposed freezing fuel duty in 2027 to help ease cost-of-living pressures.

Fuel duty in Jersey was frozen from 2023 to 2025 before rising in line with inflation in 2026. In the proposed 2027 budget, the government has suggested freezing it again. It said maintaining fuel duty at its current rate would help avoid extra costs for households and businesses that rely on transport, offering continued support while many islanders remain under financial pressure.

A&A Scaffolding Solutions welcomed the proposed freeze but said it would provide limited relief if global prices continue to rise. Kelly Keating, from the firm, said rising diesel prices were a real concern, especially alongside other increasing costs across Jersey. She said construction was being hit hard because the company relies on diesel for machinery, vehicles and deliveries. Keating added that rising material, freight and operating costs were squeezing margins and making it harder to price projects with confidence. She said businesses can only absorb so many increases before they affect investment, project viability and the prices customers pay.

Tree surgeons Jonathan Le Maistre Ltd also reported a noticeable impact. Darren Hopkins, from the firm, said the business depends on vans, trucks, chippers, stump grinders and other machinery that use significant amounts of fuel. He said higher diesel prices raise operating costs, reduce margins on jobs and make it harder to avoid passing some costs on to customers. Hopkins said continued increases would concern both the business and the wider industry.

Jeremy Phillips, from Barette Plant Hire, said fuel costs had not been too much of an issue so far, but fuel surcharges were being added to hourly rates. He warned that if prices keep rising, customers may not carry on with their projects.

In the run-up to the 2027 budget, Deputy Lucy Stephenson called for a reduction in fuel duty, but those plans were withdrawn after ministers assured support was coming. Treasury Minister Alan Maclean said the government did not favour reducing fuel duty because it was not targeted. Ministers instead opted for a freeze for 2027, prioritising targeted support for families and those struggling most.

Responding to the fresh concerns, Maclean said the budget provides support directly to consumers rather than expecting businesses to absorb increased costs such as higher fuel prices. He said the aim was to help consumers manage pressures and spend in the local economy. Maclean added that fuel prices are largely driven by global markets and geopolitical events outside Jersey's control, and that the proposed duty freeze would help mitigate price rises by reducing the level of duty in real terms.

Source: BBC Business.