Petrol Prices Could Soon Hit Record High
1:31pm UK, Monday August 09, 2010
Motorists are facing higher petrol prices, with the cost of a litre set to top 120p by the end of the month.
Motorists are warned to anticipate a rise in the price of petrol by the end of August
The warning of a 3% rise came from the Retail Motor Industry Independent Petrol Retailers Association, which blamed the expected increase on currency movements and world oil price increases.
RMI Petrol, which represents around two-thirds of Britain’s 9,000 petrol forecourt sites, stated prices could even rise as high as 8% to around 125.9p per litre in the new year, smashing the current record high of 121.61p.
This increase would take into account the rise in VAT and the planned hike in fuel duty.
RMI Petrol chairman Brian Madderson said: “The rebound in crude oil pricing is disappointing but not entirely unexpected.
“It will further increase pressure on independent retailers who are fighting for survival, especially in rural areas, due to the double hit of falling volumes and tighter margins.”
Mr Madderson stated the coalition Government did not cancel Labour’s Budget commitment to raising fuel duty by 1p a litre from October 1 and a further 0.76p from January 1, with both having VAT added.
If the Government really want to help motorists, they should abandon these planned increases
RAC spokesman John Franklin on Government rises in the cost of fuel
“Then we have the coalition’s emergency Budget proposal to increase VAT to 20% from January 4, so the outlook remains extremely difficult for motorists and retailers alike,” he said.
“We could be seeing new record pump prices within six months.
“All these trends will add to inflationary pressures in our market and across the economy, threatening higher interest rates in the medium term.”
The AA stated petrol prices were 14p a litre, or £7 a tank, more costly than they were this time last year.
Spokesman Paul Watters added: “Drivers in the south east of England, the Home Counties and the M4 corridor have suffered an appalling fuel price lottery this summer.
“Prices have varied by as much as 6p a litre or £3 a tank between neighbouring towns depending whether or not there is a competitive retailer, like Asda. In 2006/07 it was just 2p.”
RAC spokesman John Franklin said: “The coalition Government have promised to take a look at options to control the price of petrol. However, the planned fuel duty and VAT rise are likely to add a further 5p a litre.
“If the Government really want to help motorists, they should abandon these planned increases.”
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