Rise in the cost of crude oil forecast to send petrol forecourt prices rocketing

City A.M. Reporter
PETROL prices are set to soar to a record high of 126p a litre in the New Year, it was predicted yesterday.

Higher fuel duty and a rise in VAT – which are both due to come into force in January – will exacerbate the rising cost of crude oil and push pump prices up by eight per cent, according to RMI Petrol.

That will see prices surge from today’s average of 116.65p for a litre of unleaded to a staggering 125.9p a litre – higher than the current record of 121.61p a litre.

RMI Petrol, which represents two thirds of Britain’s 9,000 petrol forecourt owners, also said pump prices would rise by three per cent to 120p by the Bank Holiday weekend.

British petrol prices have fallen in the last two months to an average of 116.65p for a litre of unleaded, largely due to sterling’s recent gains against the dollar.

For most of this time, crude oil prices have been hovering around the $72-$73-a-barrel mark. But yesterday a barrel of Brent Crude in London was trading at $81.08, close to its three-month high of $82 a barrel.

Brian Madderson, chairman of RMI Petrol said: “We need to remember that the coalition did not cancel the Labour government’s Budget commitment to raising fuel duty by 1p a litre from 1 October and a further 0.76p a litre from 1 January.