Hard-pressed drivers pay three-year high at pumps

Hard-pressed drivers pay three-year high at pumps
Filling up a tank of diesel is currently £11.65 more expensive than it was back in February 2016 – as the price of fuel rose to its highest in three years.

RAC Fuel Watch data shows increases of over 2p a litre in both petrol and diesel during November took average pump prices to 120.78p and 123.18p respectively.

The one snippet of good news for motorists is that sterling’s pick-up against the dollar means prices are “unlikely to shoot up further”, and may come down in the next week or so, according to RAC fuel spokesman Simon Williams.

READ MORE: Diesel car tax rises – who will be affected and by how much?

The wholesale cost of a barrel of oil remained over the $60 mark for the entire month of November, which is why we have seen no downward shift in pump patterns.

By tracking live fuel prices throughout the month, RAC Fuel Watch found that unleaded went up by an average of 2.35p per litre, with diesel increasing to the tune of 2.22p.

Back in July this year, it cost £3.55 less to fill a typical family car with petrol than it does now, and £4.50 less for a 55-litre diesel tank.

The figures are even starker going back 22 months to February 2016, when a petrol fill-up was £10 cheaper, and diesel £11.65.

Scotland enjoyed the most modest increase in unleaded, rising by 1.9p a litre over the November, while prices in Yorkshire and the Humber rose the most, at 2.6p a litre.

In the South West, diesel shot up by 2.46p compared to the average 2.22p, while Scotland again, together with London, saw the lowest 1.91p increase.

IN OTHER NEWS: Tackling poor air quality – what’s your view?

Another driving factor in the price of fuel at the pumps is OPEC, the Organization of the Petroleum Exporting Countries, which met in Vienna at the end of November to discuss oil production among its 14 nations.

The restrictions on production are intended to effectively prop-up barrel prices, which dropped as low as $26 in January 2016 due to over-production. At the recent meeting, it was agreed that a production cut scheduled to come to an end next March would extend until 2018.

RAC fuel spokesman Simon Williams said: “The market had been expecting OPEC to extend its production cut until the end of next year so after an initial rise in the price of oil during the day of the meeting, things cooled down.

“Even though the oil price is now consistently above $60 a barrel, the increased value of sterling against the dollar is helping to keep fuel prices down at the pumps. This is good news for motorists as it means petrol and diesel prices are unlikely to shoot up, in fact we may even see them come down very slightly in the next week or so.

“The price we will pay for fuel at the pump into 2018 very much hinges on how effective OPEC’s production cut continues to be in reducing the global glut of crude oil. The increased barrel price this is designed to create may also work against the group as it makes fracking for oil in the US more financially viable, which in turn may lead to America increasing its production and filling the gap from the cuts. If this happens it should mean forecourt prices won’t go shooting up.”

Copyright Press Association 2017. Motoring News articles do not reflect the RAC's views unless clearly stated.