Express UK (Link) - Louise Barnett (April 9, 2010)
The £6 ($9) gallon arrived at Britain’s petrol pumps yesterday as motorists continue to be hammered by Labour.
Unleaded hit an average of 119.9p a litre for the first time ever, breaking the previous July 2008 record of 119.7p.
But some forecourts are already charging 131.9p a litre – just a penny short of the £6 gallon.
“This is a dark day for Britain’s hard-pressed motorists,” said the RAC. And there is worse to come, warned experts last night.
A perfect storm of rising wholesale costs, the weak pound and more Government tax hikes will propel fuel costs even higher. Drivers were warned to brace themselves for a 5p-a-litre surge in the next three months, pushing unleaded prices to a 125p a litre average by the summer holidays.
Brian Madderson, chairman of RMI Petrol, which represents 6,000 independent forecourts, said: “Even without any further tax rises by a new Government one can see the price of fuel continuing to ramp upwards. Certainly 125p a litre by the summer is looking more likely every day.”
RAC motoring strategist Adrian Tink said yesterday: “Petrol prices have been rising steadily over the past year and have now reached the inevitable record high. This is only the average, however. In some areas, motorists will be paying close to £6 a gallon – 131.9p a litre.
“This is a key election issue for Britain’s 32 million motorists, who see their bank accounts drained every time they fill up. They will be keen to see what the political parties have to say.”
Rising pump prices have already increased the average two-car family’s monthly petrol spend from £233.32 in January to £254.60, says the AA.
Spokesman Paul Watters warned the prices were unsustainable. “We can only hope that the General Election produces a result that strengthens the pound and puts downward pressure on prices.
“With potential consumer spending that would help fuel economic recovery being siphoned off at the pump, the stakes are high,” he said.
Worse lies ahead as wholesale fuel costs continue to soar. Last week’s 1p-a-litre rise in fuel duty also pushed up the cost of diesel, which is now an average of 120.6p a litre.
Pundits say the weak pound, Government tax hikes and high petrol refining costs are all to blame for unleaded’s price leap. Crude shot to an 18-month high above $87 a barrel this week, from $69 in February. Though well below the 2008 high of $147, crude is on track to reach $100 a barrel by next year as demand grows with the global economic recovery.
Forecourt spokesman Mr Madderson warned: “There are no rays of sunshine on the horizon.”
To compensate, drivers are using less and less fuel. Some garages have suffered a 20 per cent drop in sales, says RMI Petrol.
A series of Labour fuel tax increases have added around 8p a litre to the pump price since late 2008. Another planned duty hike in October will push up unleaded and diesel by 1p a litre plus VAT.
And fuel duty which is currently at 57.19p a litre will rise again next January by 0.76p.
Brendan McLoughlin at petrolprices.com, says the collapsing pound is mainly to blame.
The pound has fallen by about 15 cents against the dollar in recent months, from $1.67 last November to $1.52 today.
AA patrol staff will stage their first-ever walkout in a series of 48-hour strikes over pensions from May 2.