Petrol prices have hit record highs, putting further strain on families as the cost-of-living crisis worsens.
The average cost of petrol rose to 148.02p a litre on Sunday, surpassing the previous high of 147.72p last November, the AA said. Diesel hit a new high of 151.57p per litre.
Motorists face paying £81.41 to fill a 55-litre petrol car, compared with £66 a year ago. Experts warned that prices would continue to rise with records broken almost daily, amid fears that a Russian invasion of Ukraine could have a knock-on impact on supply.
Luke Bosdet, the AA’s fuel price spokesman, said: “The cost-of-living crisis has been ratcheted up yet another notch, tightening the vice on family spending when it faces other pressures from impending domestic energy cost and tax increases.”
A barrel of Brent crude, the global benchmark, traded above $95 yesterday, its highest price in more than seven years. It was $60 a year ago and analysts predict that it could “easily” surpass $120 a barrel in the coming months.
The increases have been largely driven by a rebound in global demand as the pandemic eases, combined with Russia and the Opec states cutting production. The rise in forecourt prices has been worsened by retailers increasing profit margins in an effort to recoup losses during the Covid lockdowns.
Supermarkets stand to rake in bumper petrol profits, exacerbating the cost-of living crisis. In January the big four supermarkets made an 8.6 per cent margin on sales of unleaded petrol, almost triple the 3.2 per cent margins they made in 2019.
Simon Williams, a fuel expert at the RAC, said: “With the oil price teetering on the brink of 100 dollars a barrel and retailers keen to pass on the increase in wholesale fuel quickly, new records could now be set on a daily basis in the coming weeks.
“The oil price is rising due to tensions between Russia — the world’s third-biggest oil producer — and Ukraine, along with oil production remaining out of kilter with demand as the world emerges from the pandemic. As a result, drivers in the UK could be in for an even worse ride as pump prices look certain to go up even more.”
Research by the AA found that 43 per cent of its members were cutting back on car use, other consumer spending, or both. In its poll of more than 15,000 motorists, the figure rose to 59 per cent for the youngest drivers and 53 per cent for lower-income motorists.
The Petrol Retailers’ Association, which represents independent service stations, said that motorists bought 15 per cent less fuel last year compared with before the pandemic. It pledged to ensure that pump prices remained “as competitive as possible”.