Motorists benefitted from lower petrol prices in October, with prices down for the first time in three months. But prices are expected to rebound soon.
Unleaded petrol fell from 118.84p per litre at the beginning of October to 118.17p by the end of the month – a fall predicted by motoring organisation the RAC earlier in the month.
Diesel, however, rose for the fourth consecutive month in October from 120.21p per litre to 120.80p.
But the price of a barrel of oil has tipped over $60 for the first time in two years, which the RAC says signals the end of any further price cuts. The cost of a barrel rose by 9% in October alone, $5 higher than at the start of the month. This was despite relative stability in the value of Sterling against the US Dollar.
RAC fuel spokesman, Simon Williams, believes petrol retailers will pass on the price increases much quicker than they did with the savings: “At the start of October there was a 6p saving in the wholesale price of unleaded, which retailers eventually passed on to motorists in pump price reductions. This month, however, the situation is reversed and the petrol wholesale price has gone up by 4p.
“Inevitably, this increase will be passed on to motorists on the forecourt far more quickly than the cuts were made last month, but that is unfortunately the nature of ‘big’ fuel retailing: pass on wholesale rises quickly and cling on to savings for as long as possible.
“Eyes will also switch to the Chancellor who delivers his Budget this month, and with higher wholesale costs filtering down to the forecourts, the last thing they’ll want to see is an increase in fuel duty. We urge the Chancellor to resist this and leave the rate unchanged.”