Drivers already feeling the pinch due to the cost of motoring, such as paying for fuel and
Speaking at the Conservative Spring conference in Cardiff, Mr Osborne said that he had "heard" protests from motorists about being "squeezed" by rising costs at the pump.
But is may not be all good news for motorists, after a government minister warned that the turmoil in Libya and the Middle East could drive petrol costs above £2 per litre.
Alan Duncan, the international development minister, who previously worked as an oil trader, said the current rate of £1.30 could look like a "luxury" if the situation got worse.
Signalling he was ready to ease the pressure by dropping the increase in his Budget later this month, Mr Osborne told delegates: "I know how hard the rises in world oil prices are hurting families in Britain.
"When it costs £1.30 for a litre of petrol, £80 to fill up a family car, I know people feel squeezed.
"And I say this to people watching: I hear you."
Despite Liberal Democrat doubts, the Treasury is still believed to be looking at the idea of a "fair fuel stabiliser" - where duty is reduced or raised to offset oil price movements.
The Chancellor also said the crucial March 23 package would include a series of measures to boost growth and tackle the "forces of stagnation" in Britain's economy.
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