2012 petrol sales down 3.9%, diesel up 1.6%, fuel duty receipts down 0.8%
A three-quarters-of-a-penny increase since the New Year indicates that petrol prices in the UK are on the rise again after three and a half months of gradual falls, the latest AA Fuel Price Report reveals.
At the end of the month, the Office of Fair Trading reports back on its call for information on UK fuel pricing – not soon enough for a Berkshire town that called for a boycott of its forecourts. It had become the latest to suffer a £2.50-a-tank postcode lottery surcharge for supermarket petrol.
Mid-January petrol prices across the UK are marginally up on a month ago, now averaging 132.71p a litre compared to mid-December’s 132.32p. Through the Christmas period and first week of January, the petrol price grounded at 132.0p a litre before a 2p-a-litre rise in wholesale costs began to lift it again.
Diesel is marginally cheaper than a month ago, having fallen by a third of a penny in the third week of December. Throughout Christmas and early January, it rooted itself to around 140p a litre and now averages 140.32p a litre, compared to 140.38p in mid December.
Arguably, despite diesel prices returning to where they were a month ago, its users are worse off. A litre of diesel has been on average 8p a litre more expensive than petrol, echoing last winter’s 8.6p differential. As the summer’s price difference was 5p a litre, the owner of a new diesel car is losing 20% of the savings advantage over a new petrol car. This is partly due to the fuel industry not passing on wholesale price reductions.
Through December into January, the fuel industry failed to pass on fully a 2p fall in diesel wholesale costs - with VAT, worth 2.5p at the pump. Between late November and early December, the cost of diesel to retailers fell from around 53p a litre to below 51p, but the average pump price only fell from 141.5p to 140p a litre. Since the start of the new year, a weaker pound against the dollar, the currency used for trading oil and fuel, is putting upward pressure on pump prices.
Newbury, with around 30,000 residents, became the latest small town to be paying 5p a litre more for supermarket petrol compared to a neighbouring town (Reading). A district councillor called for drivers to boycott the town’s fuel stations. Newbury joins a list that includes New Ollerton in Nottinghamshire, Aylesbury in Buckinghamshire and Dover in Kent. Last March, Aylesbury councillors protested to supermarkets about the £2.50-a-tank local surcharge.
Oil price speculation started early with Commerzbank forecasting a rise to $120 a barrel. The US government’s Energy Information Administration forecasted $105 this year and $99 in 2014.
The Government’s mid-term review offered to extend the 5p fuel duty rebate for island communities to remote areas on the mainland. The original implementation in March 2012 was chaotic as surging fuel prices swamped the saving. The UK’s lack of transparent wholesale prices makes it impossible for consumers to see if they are getting the full benefit.
OFGEM has started a consultation on removing electricity price caps for charging electric cars. Intended to encourage more public recharging points, the question is whether price will become as vexing an issue as the cost of petrol and diesel.
HM Revenue and Customs figures, released on Tuesday, show the impact of high prices on petrol sales in 2012, although slightly better diesel sales limited the damage on the Government’s fuel duty receipts last year:
Fuel duty receipts:
The Office of Fair Trading decides soon whether to launch an investigation into fuel prices, hopefully tackling the fuel industry’s treatment of drivers, consumers and businesses
Edmund King, AA president
“Another new year, another new round of pump price rises after the industry failed to pass on fully wholesale price savings. The Office of Fair Trading decides soon whether to launch an investigation into fuel prices, hopefully tackling the fuel industry’s treatment of drivers, consumers and businesses,” says Edmund King, the AA’s president.
“The insight we are now getting on wholesale price movements rams home the need for this information to be out in the public domain immediately. Wholesale petrol prices turned upward in the first week of January, average pump prices six days later. If falls in wholesale were reflected as quickly, no-one would mind – but they’re not.
“Newbury’s addition to the growing list of towns paying a 5p-a-litre surcharge for petrol is a deeply worrying trend – every 1000 cars filling up with 50 litres takes £2,500 away from other retailers. Online activity and hikes in car parking charges are not the only threats to high street survival.”
Regional prices show the transition from falling to rising prices, with average petrol prices unchanged in Wales but up 0.7p a litre in the West Midlands and East Anglia. Yorkshire and Humberside remains the cheapest area in the UK for petrol at 132.1p a litre, with Northern Ireland the dearest at 133.6p.
Average diesel prices show little change month on month, apart from Scotland where average prices are down 0.7p a litre. The cheapest region for diesel is Yorkshire and Humberside at 139.7p a litre and Northern Ireland at 141.0p.