Fears of further fuel pump rises looming large, warns RAC
Fuel pump prices shot up again in February, but worse could be still to come, according to the RAC.
Its analysis finds a full tank of either unleaded or diesel now costs nearly £5 more than in late 2020. After four months of consecutive rises, a litre of petrol now costs an average of 123.38p – up from 120.22p at the start of the month – while diesel is 126.47p (up from 123.35p) having risen for the last three months. The average price of fuel at the big four supermarkets also rose by 2.8p on both fuels during February – but is 4p a litre cheaper at 119.32p for unleaded and 122.24p for diesel.
A sharp increase in the price of a barrel of oil has driven the rise in forecourt prices. In February alone oil rocketed by $10 a barrel to $65.83, a price not seen since mid-January 2020. And compared to 1 November 2020 a barrel now costs $29 more.
RAC fuel spokesman Simon Williams said: “The worry now is whether analysts’ talk of oil reaching $80 by the end of the year will prove accurate. If it does, we could see a litre of unleaded top 130p and diesel 134p.
“Much hinges on what oil producer group OPEC and its allies decide to do at their meeting tomorrow (4 March). As the build-up of crude from the pandemic is starting to diminish, they are expected to increase output, but the important question is by how much. There’s a big concern that they won’t release enough supply to soak up the increased global demand as life begins to return to something more like normal, which could cause the price to go up further. If this proves to be the case, drivers will inevitably be hit badly at the pumps.”
RAC has also reported a significant retailing anomaly due its research, with prices in Northern Ireland around 5p a litre cheaper than the UK average at 118.38p for petrol and 121.92 for diesel.
This is due to fuel being imported from the Republic of Ireland where taxes are lower per litre, coupled with the benefit of sterling being considerably stronger against the Euro than it was two months ago.