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Sunday, June 26, 2022

Fuel prices set to hit £2 a litre with the second all-time biggest rise on record

The RAC is calling on the Government to reduce the cost of fuel at the pumps either through a further cut in duty tax or VAT relief as diesel is set to reach £2 a litre.

Fuel prices are set to hit £2 a litre unless the Government steps in to intervene.

The average price of petrol increased by 11p a litre in May – the second largest monthly increase ever seen, data shows.

A litre of unleaded petrol rose from 162.87p at the start of May to 174.02p by the end of the month. This was less than a penny short of the all-time biggest rise recorded in March when a litre of petrol jumped by 11.61p (151.67p to 163.28p).

The major difference with the May rise, however, is that this happened after the historic 5p-a-litre duty cut invoked by Chancellor Rishi Sunak on 23 March. Despite this, the cost of a litre has rocketed to yet another record high.

The cost of fuel has risen to record-breaking prices. Image: Dawn McDonald.

May also saw average diesel prices climb to new heights with a litre going up to 183p, a hike of more than 5p which takes the cost of a complete tank above £100 for the first time.

A full tank of petrol also hit the landmark cost of £95.

The pump price hike has been driven by oil rising from $106.07 to a late-month high of $124.45 (31 May) – a 17% increase, combined with a weaker pound at $1.2 – an important factor as fuel, like oil, is traded in dollars on the wholesale market which can dramatically affect the price retailers pay to buy it.

RAC expects average petrol prices to hit 185p as a result of the rising cost of oil, with diesel heading towards the 190p mark. The automotive services company is calling on the Government to intervene, either through a further cut in duty or a reduction in VAT from 20%.

Spokesman for the RAC, Simon Williams, said: “May proved to be another horrible month for drivers with the average price of petrol shooting up by 11p a litre. This is the second biggest monthly increase on record and comes despite the 5p-a-litre cut in duty.

The cost of fuel is a combination of the rising cost of oil and a weak pound. Image: Krzysztof Hepner.

“Since Russia invaded Ukraine on 24 February the price of petrol has gone up 24p a litre, For diesel the figure is 30p. This means the cost of filling a 55-litre petrol car has gone up by £13, and a diesel one by £16.50. Both of these figures would have been even higher had the Government not cut fuel duty.

“While it’s hard to imagine prices getting much worse, the wholesale price of petrol has now gone above diesel which spells yet more bad news at the pumps in the coming weeks.

“With drivers facing such a dire situation on the forecourts we badly need further intervention from the Chancellor as households and businesses surely can’t take much more financial pain in conjunction with the horrendous hikes in gas and electricity.

“Something needs to be done, whether that’s a further cut in duty from the current 53p charged on every litre bought at the pumps, or a reduction in VAT from 20%.

“Arguably, a duty cut would make a bigger difference to both businesses and individuals, but it also seems very unfair that the Treasury is benefitting to the tune of 30p a litre in VAT revenue.”

Here is a guide to the cheapest places for petrol within five miles of Bradford compiled by the website Petrol Prices as of Tuesday 14/06/2022:

Asda Little Horton – petrol at 174.7p and diesel at 181.7p (last updated on Sunday).

Tesco Great Horton and Tesco Buttershaw – petrol at 177.9p and diesel at 187.9p.

Morrisons Guiseley, Morrisons Victoria, Morisons Mayo Avenue – petrol at 179p and diesel at 186.4p.

Sainsbury’s Rawdon – petrol at 179p and diesel at 189.9p.

Asda Rooley Lane: petrol at 180.2p and diesel at 183.7p.

Here is a guide to the cheapest places for petrol in Kirklees compiled by the website Petrol Prices as of Tuesday 14/06/2022:

Asda Bradford Road – petrol at 176.7p and diesel at 186.7p (last updated on Sunday).

Tesco Viaduct Road – petrol at 176.9p and diesel at 186.9p.

Sainsbury’s Shorehead – petrol at 178.9p and diesel at 187.9p.

Asda Leeds Middleton – petrol at 179.7p and diesel at 187.7p.

Sainsbury’s Dewsbury – petrol at 179.9p and diesel at 187.9p.

 

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