Petrol prices have now shot up to a three-year high

 
Courtney Goldsmith
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Koehler Urges Higher Gas Prices
Prices rose across the UK's forecourts (Source: Getty)

Petrol prices in the UK have climbed to an average of more than 120p a litre, reaching a three-year high, according to fresh data from the AA.

After oil prices rose to two-year highs, petrol averaged 120.5p a litre, having risen 2.2p a litre in the past month, and diesel prices sat at around 122.8p a litre, up 2.3p in the past month.

Research from the AA found that at the start of the week pump prices showed a substantial gap between supermarkets and non-supermarkets of 5.3p a litre, the largest since December 2015.

This month, Asda has had the lowest prices with an average of 115.48p per litre of petrol, while Shell ranked highest with an average of 122.93p per litre.

Read more: Asda fuels supermarket price war with 2p per litre petrol cut

So far this year, petrol in the UK has averaged 117.80p a litre compared with 108.99p in the same period last year. Diesel has averaged 119.34p a litre since the start of the year against 109.47p the previous year.

The AA said the price rise gives the Treasury an additional 1.5p a litre in VAT from petrol and 1.6p a litre from diesel ahead of the Budget.

“First it was Russia and the Saudis cutting back on production to boost the oil price, then the commodity market speculators pushing oil’s value to its highest in two and a half years, then rocket-and-feather pricing at non-supermarket pumps – all leading to inflation at above three per cent and an interest rate rise,” says Edmund King, the AA’s president.

“Now we find the Treasury is pulling in an extra 80p a tank in VAT from this year’s inflated pump prices. As it is, the Office of Budget Responsibility says fuel duty receipts are equivalent to each UK household paying £1,000 a year in tax. The squeezing until the pips squeak of UK family budgets has to stop – and that includes the doubling of the rate of Insurance Premium Tax."

Read more: Petrol station firm MRH eyes £1.5bn float

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