Mark
22nd February 2008, 09:29
http://www.express.co.uk/posts/view/35741/Petrol-to-hit-1-50-a-litre
Motorists were last night warned to brace themselves for even higher petrol prices – with experts predicting fuel will hit £1.50 a litre by the end of the year.
Drivers are already feeling the strain after a record 20 per cent increase in pump prices over the past 12 months. But the sky-high cost of oil means the pain will only get worse in the months ahead.
The threat of the £6.82 gallon prompted fresh calls for the Treasury to scrap its planned rise in fuel duty.
The 2.35p a litre increase on April 1 will swell Government coffers but place further strain on stretched family finances. For every £1 we pay at the pumps, 70p goes to the Treasury in duty and VAT.
Even before this week’s surge in the cost of crude oil to a record 101 dollars a barrel, fuel prices had been rising at their fastest rate for a decade. Unleaded has soared from an average of 86p a litre this time last year to 104.3p. It means a typical driver is spending an extra £8.62 every time they fill up. Diesel has risen even further, to 109.3p a litre. To add to motorists’ misery, other costs of keeping a vehicle on the road have also gone up steeply.
Average insurance premiums have jumped by more than twice the rate of inflation, while drivers also have to pay extra for road tax, car servicing and garage repairs.
Brendan McLoughlin, managing director of the website Petrolprices.com, warned: “If these conditions in the crude oil market continue, we will hit £1.50 a litre this year.
“Chancellor Alistair Darling is planning two further fuel duty increases by October and, with such worldwide economic instability, oil prices are likely to rise in the future.
“The last time oil hit $100 a barrel it was artificially inflated by a rogue trader wanting to claim his place in history as the first to buy oil at such a landmark price.
“This time, the price has jumped as a result of speculation over conflict in Nigeria, a refinery explosion in Texas, market traders using commodities as a way to protect themselves against a weak dollar and fears that Opec (the Organisation of Petroleum Exporting Countries) will cut production because oil reserves are drying up.”
Oil prices have climbed from under 50 dollars a barrel at the start of last year.
Experts warn the price will rise even higher on the back of huge demand and political uncertainties around the world.
Ray Holloway, director of the Petrol Retailers Association, predicted prices would hit $120 a barrel by the summer.
Oil prices dropped 10 per cent in January before peaking again this week.
However the dip has not been reflected on most garage forecourts.
The AA calculates the average driver is spending an extra £18.48 a month on fuel compared with a year ago.
President Edmund King, said: “If the average cost of petrol continues to rise the Chancellor will surely find it impossible to add 2.35p in duty and VAT at the start of April. The increase would simply backfire by fuelling inflation.”
A Treasury spokesman said: “The policy on fuel duty for the next three years was set out in the budget in March last year and remains as stated.”
Motorists were last night warned to brace themselves for even higher petrol prices – with experts predicting fuel will hit £1.50 a litre by the end of the year.
Drivers are already feeling the strain after a record 20 per cent increase in pump prices over the past 12 months. But the sky-high cost of oil means the pain will only get worse in the months ahead.
The threat of the £6.82 gallon prompted fresh calls for the Treasury to scrap its planned rise in fuel duty.
The 2.35p a litre increase on April 1 will swell Government coffers but place further strain on stretched family finances. For every £1 we pay at the pumps, 70p goes to the Treasury in duty and VAT.
Even before this week’s surge in the cost of crude oil to a record 101 dollars a barrel, fuel prices had been rising at their fastest rate for a decade. Unleaded has soared from an average of 86p a litre this time last year to 104.3p. It means a typical driver is spending an extra £8.62 every time they fill up. Diesel has risen even further, to 109.3p a litre. To add to motorists’ misery, other costs of keeping a vehicle on the road have also gone up steeply.
Average insurance premiums have jumped by more than twice the rate of inflation, while drivers also have to pay extra for road tax, car servicing and garage repairs.
Brendan McLoughlin, managing director of the website Petrolprices.com, warned: “If these conditions in the crude oil market continue, we will hit £1.50 a litre this year.
“Chancellor Alistair Darling is planning two further fuel duty increases by October and, with such worldwide economic instability, oil prices are likely to rise in the future.
“The last time oil hit $100 a barrel it was artificially inflated by a rogue trader wanting to claim his place in history as the first to buy oil at such a landmark price.
“This time, the price has jumped as a result of speculation over conflict in Nigeria, a refinery explosion in Texas, market traders using commodities as a way to protect themselves against a weak dollar and fears that Opec (the Organisation of Petroleum Exporting Countries) will cut production because oil reserves are drying up.”
Oil prices have climbed from under 50 dollars a barrel at the start of last year.
Experts warn the price will rise even higher on the back of huge demand and political uncertainties around the world.
Ray Holloway, director of the Petrol Retailers Association, predicted prices would hit $120 a barrel by the summer.
Oil prices dropped 10 per cent in January before peaking again this week.
However the dip has not been reflected on most garage forecourts.
The AA calculates the average driver is spending an extra £18.48 a month on fuel compared with a year ago.
President Edmund King, said: “If the average cost of petrol continues to rise the Chancellor will surely find it impossible to add 2.35p in duty and VAT at the start of April. The increase would simply backfire by fuelling inflation.”
A Treasury spokesman said: “The policy on fuel duty for the next three years was set out in the budget in March last year and remains as stated.”