Drivelease posted on February 23, 2012 11:52
The price of diesel has rocketed by 10p per litre in just 12 months – an inflation-busting 7% rise – to an average price of 143.05p per litre beating by 00.01p the price on May 4 last year and now at a level, says RMI Petrol, that could derail Government plans to curb inflation. Meanwhile, petrol prices are 5% up on February 2011, though the average price at 135.09p per litre is short of the May 2011 record of 137.43p per litre.
For a commercial van with an 80-litre fuel tank, the cost of filling up has risen from £90.90 in February 2010 to £ 114.44 now, having dropped to £110.07 in July last year, said the AA. For a commercial van with an 80-litre fuel tank, the cost of filling up had risen from £90.90 in February 2010 to £ 114.44 now, having dropped to £110.07 in July.
RMIPetrol chairman Brian Madderson called the price hike a disaster for motorists and claimed that it put the livelihoods of hundreds of fuel retailers at further risk.
He also warned that there was more grim news ahead as a ‘perfect storm’ of global factors including rising crude oil prices, closing refineries and pressure on supply, meant that by Easter diesel and petrol prices go even higher.
AA president Edmund King said: ‘A stronger pound has staved off this moment for longer than might have been expected, but diesel drivers across the country will have been watching in trepidation. They hoped that below-record prices would hold until the spring, when winter price pressures on diesel traditionally ease.’
Inflation for diesel is now almost double that of the Consumer Price Index (CPI) of 3.6% leading to Madderson to say that the March 21 Budget was the ideal opportunity for Chancellor of the Exchequer George Osborne to cut the rate of duty on fuel, as he did last year.
Madderson also called on the Government to ease the pressure on motorists and the economy by ditching plans to raise fuel duty by 3.02p per litre from August 1. Such a rise, he said, would result in a 4p per litre price hike once VAT at 20% was included.
Madderson said: ‘It’s all very well for the Government and the Bank of England to declare that CPI is heading down, but try telling that to our cash-strapped retailers and to the millions of motorists, truckers and van drivers now paying an average 143.05p per litre for their diesel. We are seeing run-away inflation for diesel and petrol is little better.’
RMI Petrol says it is so concerned that after months of intensive evidence-gathering it has made a formal submission to the Office of Fair Trading recommending that it conduct an urgent new study into the UK fuels market.
Madderson added: ‘This record price for diesel, plus the rising costs of petrol, means household budgets, big business and small and medium sized operators are all being squeezed by these high fuel prices. Our economic recovery seems to have stalled and Government must resist the temptation to hike fuel tax.
‘We have not seen prices like this since the record was set on May 9, 2011during the Arab Spring uprisings when diesel hit 143.04p per litre. RMIPetrol had warned Government that this worrying price rise was inevitable and now it is with us. It must cast serious doubt over any hope of the Government hitting its 2% inflation target by the Autumn.’
In 1990 there were more than 20,000 forecourts, according to RMI Petrol, while today there are just 8,500 – a drop of nearly 60%.
The AA has written to the Chancellor calling for an investigation of the oil, refining, fuel product and retail markets to ensureUK families and business are protected from over-inflated prices and supply difficulties. It has also called for an end to annual fuel duty hikes while the economy falters, including the planned rise in August.