Motorists see fuel price hikes as oil price soars

Published by Edmund Greaves on 14 May 2018.
Last updated on 14 May 2018

Motorists see fuel price hikes as oil price soars

Motorists will find nothing but woe at the fuel pumps in the wake of US President Donald Trump’s decision to withdraw from the Iran nuclear deal.

According to Confused.com’s latest fuel price index, petrol rose on average by 0.9p to 124.4p and diesel rose by 1p to 127.5p in the space of just a week.

Back in January, Moneywise reported that fuel prices had risen to the highest level in four years. And this upward trend has continued over the past 10 months. Since July 2017, petrol prices have increased by 9.3p per litre, while diesel has risen by 11.4p on average.

This means that to fill a small car (42L) with petrol will now cost £52.25, while a medium car (57L) will cost £70.91 and a large car (65L) £80.86.

Meanwhile, motorists filling with diesel will pay, on average, £53.54 for a small car, £72.66 for a medium-sized car and £82.85 for a large car.

But it does pay to shop around and there are wide variations in price, depending on where you live. The cheapest petrol can be found in Wigan, Lancashire, at £121.8p per litre, while the most expensive is in Lerwick, on the Shetland Isles, at £132.9 a litre, according to Confused.com.

Motorists in Edinburgh can fill up with the cheapest diesel at 125.1p a litre, while motorists in Lerwick are again the worst off – at £134.7p per litre.

RAC fuel spokesperson Simon Williams comments: "Prices at the pumps are likely to rise by at least 2p a litre in the next fortnight as a result of the US’s decision to pull out of the Iran nuclear agreement. The price of oil has already jumped to $77 a barrel on the back of this news.

"Drivers are already suffering as last month saw almost 3p a litre being added to the average price of petrol and diesel, making it the worst monthly fuel price rise since December 2016.

“If another couple of pence a litre goes on as a result of the higher oil price and the fact the pound is at a four-month low could take the average cost of a litre of unleaded to 126.5p - a price last seen in October 2014 - which would make filling up a 55-litre family car cost nearly £70.

“Sadly, the days of petrol and diesel for under £1 a litre in early 2016 are fast becoming a distant memory.”

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The oil price hike has

The oil price hike has absolutely nothing to do with Trump backing out of the Iran deal - that is pure lazy politically-slanted journalism. The price hike is because the OPEC cartel took a collective decision to strangle oil output in order to increase the price level. Saudi Arabia needs oil at $100/barrel in order to avoid going bankrupt. The USA does have a role in the whole matter- since fracking took off in the USA, the USA has gone from being a net importer to a net exporter, which means that the global oil supply availability has increased. This relative glut of oil in turn reduced the price, leading to OPEC countries losing oil revenues. Their answer to this is to slash their own output collectively to drown out the effect of US exports. The Iran matter is just a useful excuse, a smokescreen to divert people's attention from the truth. If anything, by stoking up fear about the matter, they are helping their own objective of hoisting oil prices.