By Neanda Salvaterra 

LONDON--About six months ago, when the oil price dipped below $40 a barrel for the first time in six years, Nicholas Samy traded in his gas-guzzling truck and bought a tiny Toyota Yaris.

"Petrol is still expensive," said Mr. Samy, an owner of a small U.K. construction company, as he filled up at a Shell station in central London, where unleaded gasoline costs a bit above GBP1 a liter--roughly $5.50 a gallon.

The lowest oil prices in a decade have yet to fully trickle down and benefit Europeans, where fuel taxes are among the highest in the world. From Belgium to Poland, Europeans are mostly driving less and buying smaller vehicles, even though gasoline prices have fallen more than 20% in some countries.

Brent crude, the international benchmark, has fallen more than 70% to less than $33 a barrel, from its peak of $114 a barrel in June 2014. European gas prices haven't fallen nearly as much.

In Sweden, gasoline prices have fallen 18% since oil began to slide, but demand there has decreased by about 3%. In the U.K, where gasoline prices have fallen by 20% since June of 2014, demand has fallen 1.8%.

Meanwhile, U.S. gasoline prices fell 44% over the same period, to less than $2 a gallon, driving demand up 2.5%. Americans got behind the wheel much more in 2015, driving an average of about 200 miles more than they did in 2014, according to data compiled by market-research firm Euromonitor International. In European countries like the U.K. and Germany, there were small declines in the average miles traveled per car in 2015, partly reflecting the robust public transportation, particularly extensive and well-connected railways.

Europeans are also buying smaller cars and recovering economies in countries like Spain, Italy and Portugal have fueled higher vehicle sales.

Compact urban cars made up 42% of all new car sales in the European Union in 2015, and over half of all automobiles sold in Denmark, Greece and France, according to AAA Data, an affiliate of France's car manufacturers association.

By contrast, auto makers sold a record 17.5 million vehicles to Americans in 2015. More than half were sport-utility vehicles, according to Autodata Corp., a U.S.-based market-research firm.

"The [auto-sales] recovery in Europe has more to do with the improving economic situation and consumer confidence than it has to do with the decline in fuel prices," said Neil King, an automotive analyst at Euromonitor International based in London.

Overall, European oil demand is forecast to have remained flat in 2015, according the International Energy Agency, a Paris-based group that monitors energy trends.

Demand fell off in the beginning of last year because of weak economic growth in Europe and more fuel-efficient vehicles on the market, said Matthew Parry, a senior oil analyst at the IEA. Gas prices didn't drop enough to permanently change Europeans' behavior, he said.

"Consumers got used to the lower oil price," he said.

A big reason for the difference between Europe and the U.S.--the world's top oil consumers--are fuel taxes. Every liter of unleaded gasoline in the U.K. comes with a 58 pence excise tax plus a 20% value-added tax on the price--typical in European countries.

In the U.S., there is a federal excise tax on gasoline at 18.4 cents a gallon, but there are also a wide range of state taxes--from as little as 8.95 cents a gallon in Alaska to 65.3 cents a gallon in Pennsylvania.

Some European consumer groups have blamed oil companies for not passing on the full savings of the oil-price drop to consumers.

"The price of oil has crashed, but pump prices have moved very little," said Edmund King, the president of the Automobile Association of the U.K., in a January news release.

Royal Dutch Shell PLC, Europe's largest oil company and a major refiner and retailer of gasoline, and other energy companies say they aren't to blame. A Shell spokesman said taxes make up two-thirds of the pump price, minimizing the impact of the plunge in crude prices.

Not all of Europe's drivers are watching their fuel budget, however.

Diesel demand is up 2.9% in the U.K. and 2.7% overall in Europe in 2015, the IEA said. Diesel cars are common in Europe and it is the fuel of choice in commercial vehicles.

In Germany, a car-loving country, people are buying new cars partly because gasoline prices have fallen 18% on average since June 2014. "It's one reason the European and the German car market is growing," said Eckehart Rotter, a spokesman for VDA, the German association of the automotive industry.

Sales of German SUVs, or Geländewagen, have been climbing steadily since 2014 and made up almost a fifth of all cars sold in Germany last year, the VDA said. Geländewagen are generally smaller than their American counterparts and run on more fuel-efficient engines.

But the general European trend has been toward smaller cars.

Most European countries also have shrinking and aging populations, resulting in smaller families, according to Euromonitor International. Families with fewer children often opt for smaller vehicles.

Melissa Taylor, a London administrator and a mother of a 10-year-old son, upgraded from a Volkswagen Golf to a chrome-blue Mini Cooper last March. She decided an SUV was too big for her family.

"It's really just the two of us," she said.

Write to Neanda Salvaterra at neanda.salvaterra@wsj.com

(END) Dow Jones Newswires

February 11, 2016 00:44 ET (05:44 GMT)