Diesel Above £2 a Litre Squeezes Jersey Business Margins

By Grace Kim

Diesel has topped £2 a litre in Jersey and the UK, and the island's construction and tree-care firms say the jump is squeezing margins and clouding project pricing. The Government of Jersey has proposed freezing fuel duty in 2027 to "help ease cost-of-living pressures," but businesses warn a freeze won't shield them from global markets.

Fuel duty was frozen in Jersey from 2023 to 2025, then rose in line with inflation in 2026. The proposed 2027 budget would freeze it again. The government said "maintaining fuel duty at its current rate will 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."

The takeaway so far: a duty freeze cushions the blow, but it doesn't cap the price of a litre.

What are businesses saying?

Kelly Keating of A&A Scaffolding Solutions said "rising diesel prices are a real concern for us, particularly when they come on top of so many other costs that seem to be increasing across Jersey."

"Construction is taking a hard hit. We rely on diesel for machinery, vehicles and deliveries, so increases put direct pressure on the cost of carrying out work," Keating said. "Alongside rising material, freight and operating costs, this is squeezing margins and making it harder to price projects with confidence."

A&A welcomed the proposed freeze but cautioned it "would offer limited relief if global fuel prices continue to rise." Keating's bottom line: "Businesses can only absorb so many increases before they affect investment, project viability and ultimately the prices customers pay."

Tree surgeon firm Jonathan Le Maistre Ltd reports a "noticeable impact." Darren Hopkins, from the firm, said "we depend on our vans, trucks, chippers, stump grinders, and other machinery that consume significant amounts of fuel."

"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. Continued increases, he added, would be a "concern for their business, and the wider industry."

Who is coping — and how?

Not every operator is hurting. Jeremy Phillips of Barette Plant Hire said rising fuel "hasn't been too much of an issue so far," because the firm adds fuel surcharges to its hourly rates.

His warning is blunt: "if the prices keep going up, customers aren't going to be carrying on with their projects." Surcharges shift the cost, but they also test demand.

Why did Jersey choose a freeze over a cut?

Before the 2027 budget was unveiled, Deputy Lucy Stephenson called for a reduction in fuel duty. She withdrew the plans after ministers assured her support was coming.

Treasury Minister Alan Maclean said the government "didn't like the idea of reducing fuel duty because it wasn't targeted." Ministers opted for a 2027 freeze instead, prioritising targeted support for families and those "struggling the most."

Responding to the fresh concerns from businesses, Maclean said: "Rather than expecting businesses to absorb increased costs such as higher fuel prices, the budget provides support directly to consumers to help them manage those pressures and spend in the local economy."

"Fuel prices are largely driven by global markets and geopolitical events outside Jersey's control," Maclean said. "What the government can do is avoid adding further pressure where it can. The proposed freeze in fuel duty will help mitigate the impact of prices rises by reducing the level of duty in real terms."

In short: Jersey is betting on consumer-side support plus a real-terms duty cut, while firms like A&A Scaffolding and Jonathan Le Maistre hedge against a global diesel price they can't control.