Department for Transport barred rail firms from hedging diesel costs

Senior rail industry figures told GB News that the Department for Transport prevented train operators from hedging fuel purchases ahead of a rise in diesel prices. The operators named include Thameslink, Avanti West Coast, Great Western Railway and Trans-Pennine Express.

According to the sources, officials viewed hedging arrangements as gambling with taxpayers' money. A DfT spokesman stated the department had received no formal hedging requests from operators over the past two years and dismissed the allegations as misleading.

Fuel cost increases reported GB News reported that state-owned Trans-Pennine Express now faces fuel costs up to 75 per cent higher than its previous £20 million annual bill. Wholesale UK red diesel prices rose nearly two-thirds between February and April, reaching 117.56p per litre.

One senior rail figure said the department had instructed operators not to hedge after taking on financial risk during the Covid period. A second source cited a Treasury direction that government does not gamble on fuel prices.

Limited options for operators Rail historian Christian Wolmar said operators facing higher costs would either raise fares or reduce services. He added that cutting trains could reduce passenger numbers and further cut revenue over time. A DfT source said fuel hedging was not a high priority in due diligence checks for companies entering public ownership.