The UK’s independent garage workshops are being squeezed in the oil market turmoil, says fuel manufacturing and waste oil company RE:Group.
As a direct result of collapsing crude oil prices, the garage industry now has to pay for the disposal of thousands of litres of oil after becoming accustomed to receiving a regular income from it over the last few years.
RE:Group’s commercial director Phil Evans calls the unavoidable charges a ’sting in the tail’ from the current oil market fall.
“It would be natural to think that garages would gain all-round from cheaper oil, but that is not the case. Charges for disposal look like remaining for some considerable time.”
One upside is that the prices garages pay for highly refined replacement lubricating oils has reduced.
Mr Evans said that the company’s RE:Claim division, which operates a waste oil collection and recovery facility in Hull, was enabling garages to meet their legal and environmental duties at a difficult time by providing a home for their waste at competitive rates.
“A crucial aspect of garage management is to make sure that used oil, oil filters, absorbents, antifreeze and brake fluid are disposed of safely and legally,” he said.
“The price of our service to the industry has to reflect the fact that, up stream, we are competing with virgin fuels, whose price, as we all know, has come down at an extraordinary rate.
“We have now reached the point where the value of the recovered fuel is lower than the cost of recovery and, as such, waste producers are required to contribute to the recovery cost,” he added.
The Oil Recycling Association acknowledges that the market expects recovered products to be offered at a discount to virgin products if they are to gain customers.
It explains that the value of waste lubricants is determined by the value of the fuel produced, less the cost of processing to meet the UK Processed Fuel Oil quality protocol.
RE:Group has a fuel manufacturing plant and UKAS-accredited laboratories at Air Street in Hull and a specialist marine waste facility in Grimsby.
It provides a range of heating fuels for industry and fully compliant specialist waste collection services.