April Fuel Price Report

UK fuel price misery with £5 gallon round the corner

17 April 2008

The £5 gallon seems likely to be coming to a garage near you soon, according to the AA's latest fuel price report.

UK average petrol and diesel prices continue to hit record highs propelled not only by soaring oil prices but the impact on supply of European refinery maintenance problems. Compared to a month ago, a litre of petrol costs 1.3 pence more at 108.06 pence per litre and diesel has risen 3.16 pence to 117.41 pence per litre.

With the price of diesel rising twice as fast as petrol, the difference in price between the two fuels has stretched from 7.49 pence last month to 9.35 now. The pre-tax cost of diesel has nearly doubled over the past three years, being just over 25 pence per litre in January 2005 and 49.6 now1.

Compared to this time last year when petrol cost 92.68 pence per litre, the average price is now 15.38 pence per litre higher, adding £7.69 to the cost of refilling the typical 50-litre fuel tank. A family with two cars has to pay £32.97 more per month for petrol.

Edmund King, AA president said: "UK motorists are spending more than £10.2 million extra on fuel each day compared to last year. This is beginning to hit the economy with car dependent motorists cutting back on other expenditure. We will be sending the Chancellor a clear message to abandon his proposed 2p per litre increase in October. Families are having to reduce high street spending and businesses, low-income and rural drivers are becoming more vocal about the impact of high fuel prices on their financial well-being. An MP in northern Scotland claimed on Monday that the high price of diesel (£1.31 ppl) and petrol is 'choking the Western Isles economy.'

"The situation is dire now but will get worse with the £5 gallon coming to a garage near you soon."

A fire at a Finnish refinery in early April, extending repairs and maintenance on its diesel unit throughout May, is the latest problem to hit fuel supply in Europe. This tightness in supply of petrol and particularly diesel is aggravating the high-price trauma being suffered by UK motorists.

Across the UK, London remains the most expensive region for petrol, continuing to reverse the tradition of highest prices in Wales, East Anglia or Northern Ireland. However, Scotland, Wales and Northern Ireland on average charge the most for diesel, around half a penny more than the UK average.

Notes to editors

1Mid-January 2005 price of diesel was 84.8 pence per litre, comprising 47.10 pence in duty, 12.63 VAT, and 25.07 cost of product, transportation and retailer margin. At the current price of 117.41 pence per litre, 50.35 pence is duty, 17.49 VAT, and 49.57 cost of product, transportation and retailer and retailer margin.

April fuel price report - full report here »

 

17 April 2008