Are Fuel Prices On Their Way Down?

These days, fuel costs make up a large part of car ownership and fuel economy is something everyone is looking out for when they are buying a new car or choosing new car tyres. So the latest price drops in the supermarket petrol station forecourts will be much appreciated by drivers all across the country, but will it last? Or will the inexorable rise of fuel prices begin again soon?

The supermarket petrol stations seem to be involved in a price war of late, with one particular supermarket cutting the cost of their fuel by 14 pence since the end of April. That is quite a significant drop and reduces the cost of filling the average family car by around £10. Their prices are currently 127.7 pence a litre for petrol and 132.7 pence per litre for diesel. The other supermarkets are following suit by dropping their prices by 2 pence to remain competitive. The main reason for these price drops is that the wholesale fuel price has also been dropping. In fact, across the United Kingdom, the average cost of fuel is down 10.5 pence per litre since the high was recorded in mid-April.

The situation looks fairly promising, but it is important to remember that there is a rise in fuel duty that is due to hit the pumps from August. The rise of 3.02 pence per litre may not seem like much, but it will mean that for each litre of fuel 60.97 pence will be fuel duty. When you include the VAT, it means that more than half of the price you pay at the pump is going to the government. There are discussions currently ongoing as to whether this rise in fuel duty should be reduced, postponed or even scrapped. Unfortunately scrapping it would leave the government needing to find another £1.5 billion to make up for the loss.

However, the price of oil is falling globally, and the Transport Secretary hopes that the petrol retailers will continue to pass on these savings to the consumers. The last thing anyone wants is to see a repeat of the fuel protests back in September 2000 with rolling blockades on the motorways which caused petrol pumps to run dry, as well as a lot of disruption on the roads.

As mentioned earlier, there are things that motorists can do to reduce their fuel economy, starting with choosing the right car and choosing fuel efficient car tyres, then adjusting the way they drive to reduce fuel consumption. Smooth driving, without sudden changes in speed, uses less fuel as does dropping your speed slightly.

Auto Novice

Auto Novices is a blog, that was set up in November 2011, which tries to help inform new & old automobile owners about various subjects from keeping their car in good working order right through to tips on buying a new & used motorbikes. GUEST POSTS: If you would like to produce a guest post for this blog then please contact us via the link in the navigation menu at the top of the page.