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Back to Motoring news

Motoring news

AA predicts petrol at £1.24 a litre

22/03/2010

Petrol prices in the UK are at their highest level since July 2008, according to the AA.

And the motoring group believes that further increases could see the fuel reach 124p per litre shortly after Easter.

The group's claim comes less than a week after it warned that the increasing cost of wholesale petrol was driving prices towards a record high of £1.20 a litre.

In a renewed warning to accompany the publication of its monthly fuel price report, it said that an increase in the last month of around $120 in the price of a tonne of petrol would - if passed on to the pump - result in petrol going up by around 4p above the current average. This presently stands at 117.0p per litre, according to PetrolPrices.com.

Moreover, increases in the duty and VAT levied on fuel, due to come into force on 1 April, will add 3p to the price of a litre, while at the same time, the ending of a subsidy paid to the producers of biofuel - which makes up 3% of all petrol sold in the UK - is likely to add a further penny.

The AA says that, should all three of the anticipated rises materialise, the total increase would be 8p per litre, taking the cost of petrol above £1.24 per litre.

AA president Edmund King said that "a new trinity of wholesale price rises, fuel duty increase and lost biofuel subsidy" would mean that "any bank holiday motoring fun and relaxation will tempered by a steep rise in the cost of refuelling".

Adding that there could be wider implications - particularly for those on lower incomes and young drivers - King said that such anticipated price rises "will become an important issue in the coming election".