Motorist filling up at fuel station

Fuel prices falling after 4 months of hikes

Motorist filling up at fuel stationUK fuel prices are belatedly beginning to fall after supermarkets led the way in early August 2016 with a 2p per litre price reduction on petrol and diesel.

Nationwide, RAC Fuel Watch petrol prices are now 0.41p lower than they were a month ago, meaning the average price of petrol is 111.8p per litre and diesel is 112.4p a litre.

From being slightly cheaper than petrol, diesel is regaining its price premium: the reduction in diesel prices during July was just 0.06p per litre.

RAC fuel spokesman Simon Williams said more price cuts should be in store. “We are hopeful that the early August supermarket cut will make a bigger difference to household budgets in the summer holiday period even though it came a more than a week later than it should have done.”

Falling fuel wholesale prices, he said, is being caused by an oversupply of oil and slowing global economic growth. This has made fuel significantly cheaper than a year ago.

“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.”

Prices in the East Midlands fell by the biggest margin, with petrol 1.53p per litre cheaper over the month, and diesel 0.95p per litre.

You’ll pay an average of 110.5p per litre for petrol in the East Midlands, compared to 111.7p per litre in the South East – worth bearing in mind if you’re travelling through the UK this summer.

Diesel prices only failed to fall in Scotland and Northern Ireland, but the latter is still the cheapest place in the UK to buy diesel; again, the South East is the most expensive, with diesel costing 112.5p per litre instead of Northern Ireland’s 110.9p.

That’s a hefty 1.6p per litre difference.

Unleaded and diesel pump nozzles

Be fair and cut prices NOW, RAC tells fuel retailers

Unleaded and diesel pump nozzlesUK fuel prices should immediately be cut by 3p per litre and if fuel retailers were playing fair they would have chopped prices already, says the RAC.

Pump prices are currently hovering around 11p per litre for diesel and petrol, but RAC fuel spokesman Simon Williams believes they should be around 109 per litre, with the most competitive filling stations selling unleaded and diesel for around 106p per litre.

Some motorway services are charging a shocking 127p per litre, he points out, despite the price of oil dropping to its lowest level since the start of May.

FairFuelUK has already this week accused British fuel retailers of “opportunistic and abhorrent” profiteering by not passing on savings, and now the RAC is adding weight to the call for prices to fall.

Staycation surprise

“We would hope that retailers are not taking advantage of public perceptions that fuel prices would rise following the Brexit vote last month,” said Williams.

Giving them the benefit of the doubt, he added: “Retailers have a reasonable recent record of passing cost savings on, and we would like to think this is a blip rather than a new norm.

“With millions of families currently away on holiday or soon to leave, combined with a boom in staycations this year, a cut now would be widely welcomed and would give motorists confidence that retailers are not keeping prices artificially high.”

RAC Fuel Watch data shows the oil price is the biggest factor determining UK fuel prices after fuel duty.

UK fuel prices have risen since winter 2015 when unleaded hit a low of 101.27p per litre, tantalisingly close to dipping below the £1 per litre mark.

Pump prices have risen since then but now the world oil price is dipping, it’s time for fuel retailers to play fair, pleads the RAC.

UK petrol station

Fuel retailers are ‘exploiting motorists for personal greed’

UK petrol stationFuel retailers are paying less for diesel and petrol since the Brexit vote but these savings have yet to be passed onto motorists.

FairFuelUK has thus accused British fuel retailers of ‘opportunistic and abhorrent’ profiteering by not passing on the savings – adding that in some cases, fuel prices have actually risen.

The wholesale cost of diesel has fallen 1.67p per litre since the Brexit vote in June, says FairFuelUK. Petrol is even cheaper: it costs 3.65p per litre less. Despite this, average diesel prices are unchanged and the average price of petrol is up by 1p a litre.

It is independent fuel retailers who are to blame, says FairFuelUK founder Howard Cox. Supermarkets are starting to bring down pump prices but smaller forecourts are not.

“The Petrol Retailers Association should tell Britain’s 37 million drivers why their members appear to be increasing their profits since Brexit. Are they deliberately exploiting market and political uncertainty for personal greed?”

Retail fuel margins have risen nearly 2p a litre since the EU Referendum on 23 June, according to FairFuelUK research. Retail profits are up even more: from 6.23p per litre to 10.66p on every litre sold.

Of course, said FairFuelUK campaigner Quentin Willson, retailers need to make a decent profit, “but failure to pass on these wholesale falls is nothing short of opportunistic and abhorrent”.

Labour MP and Transport Select Committee member Rob Flello went further: “Motorists and professional drivers continue to be ripped off by an industry that hides the true costs of producing our fuels. The new PM has the chance to end this disgrace.

“Of course the fuel industry could voluntarily stop profiteering, but without government intervention there’s no sign of that happening.”

Motorist filling up with fuel

Cheap fuel is good for business says RAC

Motorist filling up with fuelThe fall in fuel prices over the past year has saved business 11% in petrol and diesel costs – and companies admit their employees are driving more miles and doing more business as a result.

Some firms are, however, also future-proofing themselves against fuel price rises by investing the savings in buying fuel-saving hybrid vehicles.

More car news on Motoring Research

The RAC Fuel Watch survey of 500 business decision-makers found that more than one in four admit their staff are making more journeys by vehicle because of the fall in fuel costs. This could be because driving is now appreciably cheaper than other forms of transport such as rail or air.

RAC corporate business sales director Jenny Powley added it shows businesses are not simply banking the saved cash, but are “getting on the road to drive their businesses forward.

“By adding new vehicles to fleets, embarking on motor journeys and covering more miles, companies appear to be doing more business, and we are certain this will be rewarded.”

The fall in fuel prices over the past few years is striking: from an all-time high of 148p per litre of diesel in April 2012, the average cost today for both petrol and diesel hovers around the 112p per litre mark. On large fleets of vehicles, that’s a significant saving.

Brexit is unlikely to push up costs either: the pound has weakened, but so too has the price of crude oil – meaning prices are predicted to fall further in coming weeks. The RAC is predicting a 2p per litre cut.

Some bold firms are taking full advantage by actually buying less fuel-efficient cars – 22% have chosen larger, less economical cars as a result of cheap fuel.

More sensibly, 18% are putting the extra cash into hybrid vehicles – which the RAC says indicates the technology is now sufficiently advanced for fleets to consider it viable.

RAC Fuel Watch

Fuel prices up for 4th month in a row

RAC Fuel WatchThe price of unleaded petrol and diesel has risen for the fourth month running, with June pump prices going up by 1.5p a litre – despite the wholesale cost of fuel rising only slightly.

So why have pump prices gone up by around 6p a gallon? It’s not entirely clear: RAC Fuel Watch data shows that although the pound weakened 7% following the UK’s ‘Brexit’ decision to leave the European Union, oil prices also fell 6%. The wholesale price of fuel was thus largely unaffected.

Despite this, forecourt prices continued their four-month upward trajectory, one that’s seen unleaded go up by more than 10p between March and June. This means the average family petrol car costs £5.64 more to fill up today than it did back in March.

The average diesel car is almost £6 pricier to fill today than in March.

This is “enough to make an unpleasant dent in household budgets up and down the country,” said RAC fuel spokesman Simon Williams, “especially for those who have more than one car or need to fill up regularly.”

“But it is good news that fuel prices are so far weathering the Brexit storm. We may well see pump prices rise slightly in July, but current indications are that that is unlikely to be the shock rise some were predicting.”

This means that although fuel prices have risen, oil prices are unlikely to rise in the foreseeable, so at least prices at the pumps should now begin to stabilise.

“There is also a hope that prices might even fall once various issues that have hindered production around the world are resolved,” added Williams.

Shell filling station

Fuel price rise fears unfounded believes RAC

Shell filling stationRAC Fuel Watch experts believe imminent fuel price rises are unlikely, despite the price of crude oil being on an upward path for the past few weeks.

The supply glut that’s led to the recent low fuel prices is, according to some, coming to an end, but RAC fuel spokesman Simon Williams does not feel this is automatically going to mean pricier petrol and diesel.

Natwest: ‘warning lights flashing’ as motoring costs set to soar

Indeed, “the latest news is that U.S. crude supplies have actually increased again rather than shrunk so there is now talk that the market has risen too far, too quickly.

“This could well take the heat out of the oil price.”

Because of this, Williams believes rather than rocketing, fuel prices are more likely to be kept in check for Britain’s 30 million car drivers.

There are politics at play too, he adds: some fear that the oil price is set to go above $50 a barrel for the first time since October 2015, but Williams says that if this was the case, the U.S. would likely step up oil production from fracking.

“OPEC does not want to see this happening so there is likely to be a renewed focus on increasing production to deflate the oil price.”

Last week, Natwest warned that motoring costs are set to soar due to a combination of rising repair, maintenance and insurance costs – although it did add that it’s low fuel prices that have led to today’s motoring costs being at their lowest level since 2009.

MPG Marathon

Fuel prices go up for second month running

MPG Marathon
Petrol and diesel prices rose again in April as a recent 25% increase in the price of a barrel of oil continues to have an impact at the filling station.

More than 3p a litre was added onto the price of petrol and diesel last month alone, with both diesel and unleaded petrol going up to 108.9p a litre.

It means forecourt prices are now the highest they have been since November 2015.

So, should we be worried by these fuel price rises? Well, for the moment, no, reckons RAC Fuel Watch spokesman Simon Williams. “The world is still producing too much oil, which means prices should not rise too much further, and may stabilise or even start to fall again.”

It’s strange times for the world oil market, he says. OPEC has been overproducing for some time to try and calm the U.S. fracking industry. This has worked to an extent, and reduced production in Iraq, Nigeria and the UAE also helped push the price up in April.

A barrel of oil now costs $45.49, up $9 in one month.

“But, if the barrel price reaches $50, drilling would become a profitable option again for U.S. shale produces and OPEC’s long-term efforts to maintain its market share would be undermined.

“For this reason it seems unlikely that the oil price will increase too much more.”

Which is good new for British motorists, given how the average price of filling the 55-litre tank of an average family car has gone up £3.29 since 1 March…

Shell Autogas

Pre-Budget 2016 warning for Chancellor: fuel prices are going UP

Shell AutogasAhead of Budget 2016, the RAC has revealed that fuel prices are already starting to go up, after months of reductions due to fall in the price of oil.

Any increases in the pump price of fuel may compound any increase in fuel duty rumoured to be included in the 2016 Budget – and undermine any claim by the Chancellor that falling fuel prices mean motorists won’t notice the increase.

“With two supermarkets now having increased their prices at the pump,” said RAC fuel spokesman Simon Williams, “we may well see others follow suit this week.

“As a result, we’re seeing average prices rise slightly, with a litre of unleaded now being sold for a little under 103p, and diesel just over 103p.”

Crude oil is still relatively cheap though, says the RAC, currently hovering around the $40 per barrel mark. This means that further fuel prices shouldn’t be on the horizon, even if the magic sub-£1 a litre promise seems now to have disappeared.

As things stand, added Williams, “we don’t think motorists need to be concerned that price are going to suddenly shoot up – unless of course the Chancellor decided to increase fuel duty in tomorrow’s Budget.”

The Road Haulage Association (RHA) has issued a plea to Osborne, calling for him to resist increasing fuel duty in tomorrow’s Budget.

RHA chief executive Richard Burnett said: “The Chancellor must hold his nerve on fuel duty. Diesel duty is a tax on the economy. Hiking it now threatens to slam the breaks on the hard economic recovery. UK fuel duty is by far the highest anywhere in the EU. It is double of that which some of our competitors pay, and a 2p per litre increase will add nearly £1,000 a year to the cost of operating a truck and that will inevitably have to be passed onto consumers.

“Hiking fuel duty will be a triple tax whammy.  It will hit UK competitiveness, put up prices in the shops, and hurt the environment as hauliers will have less money to invest in clean Euro 6 trucks.”

Fuel economy and running costs

Is this as good as it gets for cheap fuel prices?

Fuel economy and running costsPetrol and diesel prices have been falling for seven months running now, but the days of the sub-£1 per litre may now be numbered as oil prices start to show signs of rallying.

The RAC says that $26 for a barrel of crude oil is a 12-year low that was reached last week – but since then, prices have rebounded: even by the end of January, they were back up to $33.

And the wholesale prices of diesel and petrol – the prices fuel retailers pay for the raw stuff – have already begun to rise as a result.

If the market continues to creep up, says fuel spokesman Simon Williams, “wholesale costs will rise further which will in turn lead to pump price increases.”

But it shouldn’t be much, he adds. Prices may go up but they may well come down again, due to the notorious volatility of the oil market. “Even if there is a rise in the oil price, it seems unlikely that it will be drastic.”

The bigger worry for motorists, says Williams, should be the exchange rate. The pound has weakened “significantly” against the dollar and, “with oil traded in dollars, this could prove to be even more harmful if the pound continue to lose value against the dollar while the oil price goes up.”

Quick, get that big V8 and enjoy it while you can still afford to…

RAC diesel car

Cut diesel prices to £1 a litre NOW, says RAC

RAC diesel carThe RAC has repeated its call for fuel retailers to cut diesel prices to £1 a litre or less – because wholesale savings are currently not being passed on at the forecourt.

“We are still looking for the supermarkets to cut the price of diesel properly and give motorists the Christmas present they deserve,” said RAC Fuel Watch spokesman Simon Williams.

“The wholesale price of diesel is still 2p a litre cheaper than petrol, but despite this the average pump price of diesel is 106p – 3p a litre more expensive than unleaded.”

This is out of line with what’s happening on wholesale markets, he stressed.

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If pump prices more closely reflected reality, said Williams, “we would have seen £1 a litre diesel already. The cuts to the diesel forecourt price should have happened far faster and been far more dramatic than has been the case.”

The fact that it hasn’t is “bad news for the country’s 11 million diesel car drivers”.

As the price of oil has sat below $40 a barrel for the past two weeks, and petrol prices have been sub-£1 a litre for some time now, it’s time for fuel retailers, particularly the supermarkets, to act. Who’s going to be first?

Oh, and if you think fuel is currently cheap in Britain, take a look to France to see what cheap diesel is really like. Current price over there? €1 a litre.

That’s 73p a litre…