The cost of a litre of fuel has reached a three-year high and experts are predicting it could continue to climb to near-record levels.
According to RAC Fuelwatch figures, on Sunday, the price at the pumps reach 127.22p per litre for unleaded and 129.96p per litre for diesel – up seven pence and three pence respectively on the price at the start of the month.
If prices continue to climb at such a rate the cost of filling an average car’s tank could be as much as £8 more than in mid-May.
The price hikes have been driven by the rapidly rising cost of oil, which last week hit $80 a barrel for the first time since November 2014. Now oil industry insiders are warning that it could continue to climb to $100 a barrel – a price last seen in August 2014.
“If the price of oil goes up towards $100 a barrel we will very likely see a return to the dark days of April 2012 when petrol and diesel hit record highs”
Simon Williams, RAC
If that happens and the pound remains at its current level against the dollar, forecourt prices could reach averages of 141p a litre for petrol and 144p for diesel.
Even if the rise isn’t as sharp, according to the RAC’s predictions, unleaded is likely to reach 128.5p and diesel 131.5p in the next two weeks.
Worst yet to come
RAC fuel spokesman Simon Williams said: “Fuel prices are now at their highest since mid-October 2014, which means we are paying 25p more a litre than we were at the start of 2016.
“And, sadly for motorists, and household budgets up and down the UK, the worst may be still yet to come. If the price of oil goes up towards $100 a barrel we will very likely see a return to the dark days of April 2012 when petrol and diesel hit record highs. Even though the oil price was higher then (around $120 a barrel) today’s weaker exchange rate will lead to similar prices at the pumps.
“The oil price has increased by $30 a barrel since last July as a result of OPEC (the Organisation of the Petroleum Exporting Countries) and Russia limiting production to reduce an oversupplied market. On top of this we now the United States’ decision to re-impose economic sanctions on Iran which is the third biggest oil producer in OPEC. This will tighten supply even further and cause the barrel price to go up even more. The oil glut that made fuel prices so low two to three years ago is fast becoming a distant memory and the bad times of the high pump prices of 2012 may unfortunately be returning.”