March fuel price update April fuel duty hike will add 2.12 pence to the price of a litre

March fuel price update

April fuel duty hike will add 2.12 pence to the price of a litre

April 1’s fuel duty rise will boost pump price rises this year by another 2.12 pence, the latest AA Fuel Price Report warns. Since the beginning of the year, the typical cost of a tank of petrol has gone up £1.70. In less than a fortnight, it will increase a further £1.06.

Since the beginning of the year, the average UK petrol price has risen 3.41 pence, from 87.15 pence per litre to 90.56 now.

The 1.84 pence per litre increase in fuel duty on April 1 will, with VAT, add another 2.12 pence to the price of a litre of petrol. On the current price, this will make a litre of petrol 5.53 pence a litre more expensive than at the start of the year.

The AA will be meeting the Treasury Minister today to argue that the nearly 2p increase in fuel duty should not go ahead as it may hinder economic recovery.

Soaring price rises in the early part of the year have finally levelled off and between mid-February and mid-March the average UK price of petrol fell a third of a penny, from 90.88 pence per litre to 90.56. The average cost of diesel has dropped from 100.79 last month to 99.77 now.

The petrol-diesel price gap, now 9.21 pence, continues to shrink.

Three of the four main supermarkets have raised their average petrol prices while most non-supermarket retailers have lowered theirs. Nevertheless, supermarkets remain broadly 1.4 pence a litre cheaper than the other retailers, although the price gap between the two types in many towns is extremely tight.

Although diesel drivers in Northern Ireland have enjoyed the biggest regional drop in the price, petrol car owners there will be angry and frustrated. The price of a litre has fallen in all other areas of the UK, but theirs has gone up two-thirds of a penny. Other rural areas in the UK, such as East Anglia and the South West, have seen the biggest petrol price falls over the month.
AA comment

“On April 1, if the Government goes ahead with its fuel duty hike, it will join local authorities in conveniently forgetting that drivers also face the threat of severe financial hardship from the credit crunch - echoing Richmond’s proposed £800,000 raid on car parking, Edinburgh’s unjustified doubling of parking permit costs for large families and proposed workplace charges in Nottingham and Milton Keynes,” says Edmund King, the AA’s president.

“Many non-supermarket retailers appear to be giving drivers more credit with pricing to challenge the supermarkets. At present, it seems that supermarkets may fight for customers in the aisles this Easter, some giving 10% off on grocery shopping, rather than luring them to the pumps. The ground appears wide open for fuel retailers that want to attract the lucrative Easter motorist trade.

“On a wider scale, discussions the AA had with fellow European motoring clubs last summer on soaring fuel prices has led to correspondence with the EU’s competition commissioner. The EU has now launched a probe of spot and wholesale fuel prices on the Continent, which will be welcomed by UK drivers. Many still can’t understand why, even with a 30% loss in the value of the pound against the dollar, petrol is 90 pence a litre with oil at $45 dollars: in March 2007, the last time UK petrol cost 90p a litre, oil was priced at $68.”

View the full AA Fuel Price Report.

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