UK fuel prices reach 15-month high

Petrol and diesel prices across the UK are at the highest level since July 2015, according to the RAC.

The motoring group said on Thursday that October saw the biggest petrol price rise at UK forecourts in three and a half years - since February 2013 - and diesel prices rose at the fastest rate since May 2008.

The weak pound and a higher oil price are the main factors contributing to the price increase.

Data from the RAC’s latest Fuel Watch report shows that average petrol prices last month rose by 4.39p per litre, from 112.34p on 2 October to 116.73p on 31 October. Diesel was up 5.17p per litre, rising from 113.48p at the start of the month to 118.65p.

At these prices it costs £64.20 to fill an average-sized 55-litre petrol family car, with a similar diesel car costing £65.25 per tank to fill. For a light commercial diesel vehicle with an 80-litre tank, it now costs £94.92 to fill from empty.

However, there is good news for motorists expecting prices to continue rising at the same rate. There are indications that pump prices might stabilise or even reduce slightly in November, as the cost of oil started to fall back in the last days of October, the RAC pointed out.

A barrel of Brent crude averaged just under $50 through the month but ended October at a one-month low of $46.63, down from its peak of $51.63 on Wednesday 19 October. Wholesale fuel prices responded by dropping sharply at the very end of the month, down by almost 1p and 2p a litre for petrol and diesel respectively.

RAC fuel spokesman Simon Williams commented: “We are a long way from the remarkably low fuel prices enjoyed by families and businesses early in 2016, when the average price of unleaded was around 102p per litre and diesel was 101p. But while the pound remains in the doldrums, and with few expecting it to recover in the near future, there are some indications that November might not shape up so badly.”

Williams explained that the biggest factor affecting what drivers pay at the pump is the oil price.

“OPEC, which represents some of the world’s biggest oil producers, recently agreed in principle a cut in production. This would mark a move away from the over-production strategy that they have employed for so long, and mere talk of a cut has been enough to force oil prices higher,” he said. “But a final deal is still to be agreed at an OPEC meeting at the end of this month and, with some analysts suggesting a deal might yet stall, this leaves open the prospect oil prices might stabilise or even fall before the end of the year.”

Williams concluded by urging Chancellor Philip Hammond to maintain the freeze on fuel duty in this month’s Autumn Statement.