18 January 2021

Fuel logistics trends for 2021

As 2020 begins to feel like a distant memory, it seems more than fitting to look ahead to 2021. As it will for almost every industry, 2020 will be remembered as an exceptionally challenging time for the fuel logistics sector. But what is 2021 likely to bring?

These are the trends and events predicted to impact fuel logistics over the next twelve months.

The dawn of a post-COVID logistics landscape

It’s impossible to consider what could be on the horizon for fuel logistics without mentioning COVID-19; the pandemic will continue to have a monumental effect on operations well into 2021 and beyond, perhaps the first example of any event doing so on a truly global scale. We took a look at the initial impact of COVID-19 on fuel logistics back in the summer, and it seems inevitable we will feel its effects for many more months to come.

After a year of mixed fortunes, the launch and rollout of a COVID vaccine will once again put the spotlight on the UK land supply chain, with some hailing 2021 as the year of ‘cold chain logistics’. Subsequently, the onus will also be on fuel distributors to keep the UK’s road network moving, while the expected reopening of the air travel industry will hopefully reinvigorate the sector further.

What’s more, the logistics industry itself seems to be adapting to the ‘new normal’, as revealed in the Barclays-BDO Logistics Confidence Index. Although most logistics operations surveyed indicated the current situation was proving difficult, nearly 60 per cent said they would look to invest in technology to drive efficiency in a post-COVID future, and almost half said they were hoping to expand their service offering.

Sustainability  

The topic of sustainability in fuel logistics has been steadily heating up over the last few years, and this shows no sign of slowing in 2021. Following the introduction of the UK’s first Ultra Low Emission Zone (ULEZ) in London in 2020, similar zones are planned for Bath and Birmingham for early 2021, with more in the pipeline for major cities in Scotland.HGVs over a certain weight must pay to enter these zones - £100 a day in London’s ULEZ – which is also due to be extended to create a single larger zone bounded by the North Circular Road (A406) and South Circular Road (A205) in October.

It’s all part of the effort to become carbon neutral as a nation by 2050. In November 2020, the government announced that the ban on combustion engines will now start from 2035, rather than 2040 as originally planned. The push towards sustainable fuel logistics therefore looks set to intensify in 2021 and over subsequent years, with a continued exploration of alternative fuels such as hydrogen, and/or electric fleets, as well as minimising empty miles and optimising sustainable driving practices.  

Brexit

Having been somewhat overshadowed by COVID this year, the Brexit transition period ended on 31st December, beginning a new era for the UK from 1st January. It’s difficult to predict how exactly Brexit will impact ultimately impact the fuel logistics sector, as the fine print in relation to key issues is yet to be determined. It seems likely however, that any logistics operation that trades with Europe will need to be as prepared as possible by taking action on measures including Economic Operators Registration for exporters, the extra customs declarations that may be necessary, paying duties in full and changes to VAT arrangements.

There is useful industry-focused Brexit advice and guidance onLogistics UK.

Take on 2021 with fuel logistics optimisation behind you

Whatever next year brings, it’s clear that the fuel logistics businesses that thrive will be those who are agile and flexible in their operational approach.

2021 seems set to be another challenging year, but technology and digitisation can help fuel distributors maximise efficiencies and adapt to unexpected change.

To find out more about Touchstar’s fuel logistics optimisation solutions and how they can help your business succeed in 2021 and beyond, please get in touch with us.


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