July marks end to four months of rising pump prices
Following four consecutive months of pump price rises, the average cost of fuel has started to fall again, new data shows.
The figures from the RAC’s July Fuel Watch report show a slight fall in the average price of diesel, down 0.06p from 112.47p to 112.41p. The reduction in the price of unleaded was slightly bigger – 0.41p from 112.20p to 111.79p – and reverses the rising price trend which began in March.
The fall in pump prices has been brought about by a reduction in the wholesale cost of both petrol and diesel. The price retailers pay for unleaded fell by 4.41p a litre and diesel by 4.67p in July, caused primarily by a $6.44 – or 11% – fall in the price of a physical barrel of oil, down from $48.07 on 1 July to $41.63 on 29 July.
The reduction in the price of oil put paid to fears that the UK’s Brexit vote would lead to a price hike as fuel is traded in dollars.
RAC fuel spokesman Simon Williams said: “July’s slight reduction in fuel prices is very welcome as it has ended four months of rising prices on the forecourt.
“The falling price of fuel on the wholesale market is being driven by fears of slowing global economic growth adding to an existing oversupply of both crude oil and refined products such as petrol and diesel. Interestingly, this has happened at time when there are oil supply disruptions in Nigeria and Libya which had they not occurred would have meant there was even more oil on the world market.
“As it is motorists continue to benefit from the lower oil price which had led to petrol prices that are nearly 5p a litre cheaper than a year ago and diesel that’s more than 3p a litre less expensive.”