Stronger pound shields drivers from wholesale petrol price rise
Average UK petrol pump prices continue to hold below the 130p a litre level despite pressure in the oil and wholesale fuel markets, the latest AA Fuel Price Report reveals.
With the pound worth 7% more against the dollar than this time last year, a 3p to 4p-a-litre increase has so far been averted.
Even so, drivers taking a spring break on the Continent can look forward to petrol prices that are more than 5p a litre cheaper in France and Germany and 15p cheaper in Spain than in the UK. A road trip in the US would have the incentive of petrol priced at the equivalent of 57p a litre.
Across the UK, petrol in mid-April averages 129.74p a litre, compared to 129.46p a month ago and 136.89p this time last year.
Diesel has fallen a third of a penny over the past month, averaging 136.26p now compared to 136.59p in mid March. A year ago, diesel cost 141.76p a litre.
Trouble began to brew for the UK motorist in late March when US gasoline stockpiles fell significantly and the market started to get excited about US demand at the start of the motoring season. The petrol wholesale price in NW Europe hit $1000 a tonne for the first time since September and a subsequent rise in the price of oil, triggered by the Ukraine crisis, is maintaining the upward pressure.
However, in September, the pound was worth around $1.56, compared to $1.67 now – the 10 cent difference equivalent to a 3p to 4p a litre change at the UK petrol pump.
Prices look even better for drivers holidaying in Europe this spring. The pound is slightly stronger against the euro than a year ago. This means that average petrol pump prices, which were 2.5p a litre cheaper in France and Germany compared to the UK’s last April, are now typically 5p a litre cheaper.
Spain’s average petrol price has moved from being around 14p a litre cheaper than in the UK a year ago to 15p lower now. However, a driving break in Holland or Italy will sting the British driver with an added 17p to 18p a litre at the petrol pump, compared to what they might expect to pay at home.
The UK’s economic recovery has boosted the value of the pound and insulated UK drivers from a typical US motoring season-inspired petrol price surge
Edmund King, AA president
“Pump prices across Europe have a nasty habit of exposing the impact of high tax levels on road fuel in the UK – despite the long-term freeze on duty. The government can at least take some comfort from Holland and Italy squeezing their drivers equally hard when paying tax through the nozzle,” say Edmund King, the AA’s president.
“The UK’s economic recovery has boosted the value of the pound and insulated UK drivers from a typical US motoring season-inspired petrol price surge. The other positive note is that, with banks and other funds losing their enthusiasm for commodity price speculation, that surge is not as fevered and painful as it has been over the past two years.”
Across the country, Northern Ireland, Scotland, the East Midlands and East Anglia have lost the battle to keep their average petrol prices below 130p a litre. As a consolation, drivers in all parts of the UK continue to enjoy pump prices that are around 7p a litre lower for petrol and 5p cheaper for diesel, compared to April 2013.
At present, the cheapest petrol can be found in Yorkshire and the Humber, averaging 129.3p a litre, while the most expensive is in Northern Ireland at 130.7p. London sells the cheapest diesel at 135.8p a litre and Scotland the most expensive at 136.9p.