Petrol prices on the rise – again

Jan 3 2011 by Henryk Zientek, Huddersfield Daily Examiner

MOTORISTS face further fuel price hikes in the next few days – and another big increase in the spring.

The Government’s planned fuel duty rise added 0.76p on the price of petrol and diesel at the weekend.

And tomorrow – January 4 – the increase in VAT to 20% means pump prices will go up again.

Together, it is expected the increases will add about 4p a litre to the price of fuel on the forecourts.

AA figures showed that yesterday a litre of petrol cost an average of 123.98p a litre, with diesel at 128.20p a litre.

Drivers will get a few months’ respite before the Government fuel price escalator kicks in on April – an increase equivalent to the inflation rate plus 1% – which is forecast to add another 4p to the price at the pumps.

Petrol retailer Chris Stern, of Paddock-based CJ Stern (Oils) Ltd, said: “There is not a lot of good news for motorists in the new year.

“Although the price of crude oil has fallen slightly, it is still above $93 a barrel.”

Mr Stern said most retailers would probably “roll up” the fuel duty and VAT increases and only put up their prices on Tuesday.

“They will absorb the fuel duty over the weekend,” he said. “I don’t see them putting 1p on a litre of fuel today and another 3p on Tuesday.”

Mr Stern said the double whammy meant taxation would account for more than 80% of the price paid at the pumps.

And he added: “Most people are probably unaware of the fuel price escalator, which take effect from April 1.