Why are petrol prices rising again as costs hit highest level since February?
British drivers have already been facing a tough summer with the cost of living raging on and ULEZ expanding across London (plus plans for other clear air zone charges elsewhere around the country).
So it’s not great news that petrol prices have leapt up to the highest they’ve been in months, after initially dropping in early summer.
How much have petrol prices risen by and what’s causing this latest surge? We take a look, and consider what could be next for fuel prices…
How much is petrol now as prices start to rise?
Petrol and diesel prices are at their highest since the start of the year.
Recent data (from August 13) puts petrol at an average of 149.1p per litre on UK forecourts. In just two weeks, this is an increase of 4p and it marks the highest price seen since February.
Diesel stands at an average of 150.6p per litre, with some locations seeing prices hitting 152.9p – the highest since May.
Luke Bosdet, the AA’s spokesman on road fuel prices, has said: ‘A 5p-a-litre increase in just over a fortnight will lump pressure back on diesel users, particularly on small businesses, and results directly from the oil price hike that was brought on by production cuts.’
‘By the end of last week, the wholesale price of diesel was 11p a litre higher than in mid-July.’
Why is petrol more expensive again?
The reason for the rise in petrol and diesel costs for British motorists is twofold. The first is that the pound has fallen against the dollar, and the second is that wholesale costs for oil have shot up again as production slows down.
So not only is it costing more to import the oil and diesel, but, due to the bad exchange rates, we’re getting less for what we’re spending.
Oil rose from around $74 (£58.11) a barrel at the start of the month to $85.56 (£67.19) by July 31 – and has stayed around the same level since. This is the highest oil price posted since the middle of April.
RAC’s fuel price expert, Simon Williams, had said: ‘July marks a turning point in the year for fuel prices as diesel stopped falling while petrol recorded its second consecutive monthly increase. But more concerning is the fact that oil has gone back up to $85 a barrel, causing wholesale prices to rise significantly.’
‘While we’re fortunately not in the kind of upward price spiral we experienced last year, it feels like the better times at the pump are over for the time being.’
‘If oil producers continue to curb production then bigger forecourt price rises could be on the cards.’
Could petrol prices go down again any time soon?
Unfortunately, the chances of British drivers catching a break looks unlikely. If anything, one expert believes prices could continue to climb.
As quoted by the BBC, Livia Gallarati, an oil markets analyst at Energy Aspects, said that prices could climb higher still because of supplies being dented.
She suggested Brent crude, the international benchmark for oil prices, could even move above $90 (£71) per barrel.
This is because supplies have been affected by recent outages at oil refineries across the United States and Asia, and oil rich nations such as Saudi Arabia and Russia that form part of a group called Opec+ (the Organisation for Petroleum Exporting Countries) have cut back production.
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