Cost of living: Fuel prices hit new records despite ‘plummeting wholesale costs’ | Business News

Fuel prices have hit new records as retailers were criticized for failing to reflect “plummeting wholesale costs”.

The average price of petrol was 167p a liter on Sunday, compared with 165.89p just before the start of the weekend, according to figures from data firm Experian Catalist.

Diesel now averages 179p a liter, up from 177p before the weekend.

The cost of a liter of petrol has increased by 16p in the past month, making the cost of filling a typical 55-liter family car nearly £ 9 more expensive.

The average cost of diesel has gone up by more than 24p in the past month.

Oil prices surged after Russia’s invasion of Ukraine – but started “plummeting” on 9 March, according to the Automobile Association.

The cost of oil was 110 US dollars a barrel at the end of last week, with wholesale petrol down 12p a liter from its peak of 78p to 66p on 8 March.

Oil prices started rising again last Thursday but are still lower than they were more than 10 days ago.

Luke Bosdet, the Automobile Association’s spokesman, said: “Wholesale petrol and diesel costs started to fall away dramatically on 9 March, yet more than 10 days later prices at the pumps continue to set new records.”

“Pre-pandemic, the retailers would sit on lower-cost savings and wait for either Asda or Morrison to announce price cuts, and then start to bring their prices down,” he added.

“Now that that competitive thrust has largely gone, drivers and businesses in desperate need of the financial relief from lower pump prices must struggle on.

“If this price behavior at the pump continues, the government needs to implement Northern Ireland’s fuel price transparency to show drivers what savings are possible.”

FairFuelUK condemned fuel retailers for failing to cut prices at the pump.

“By taking advantage of Putin’s invasion, those faceless fuel supply chain businesses are keeping pump prices at their record highs, despite the crash in oil prices,” a spokesperson said. “How can that be honest or fair?”

Over a third of those surveyed by FairFuelUK said they have cut back on driving, with about half saying they have sacrificed hobbies, eating out and recreational road trips.

RAC fuel spokesman Simon Williams said drivers “badly need a break from these relentless daily rises”.

The Petrol Retailers Association is among those calling on the government to cut fuel duty and VAT, having written to the chancellor about it three times.

Fuel duty is currently levied at a flat rate of 57.95p per liter for both petrol and diesel, while VAT at 20% is then charged on both the product price and the duty.

Gordon Balmer, executive director of the Petrol Retailers Association, said: “From the beginning of the year we’ve seen prices escalate. Obviously, there’s been extra VAT revenue returned to the exchequer so yes, they have made money out of it.”

There are suggestions the chancellor could temporarily cut fuel duty by as much as 5p per liter to support families and businesses through the cost of living crisis – but Mr Balmer said it would be more effective if the government followed the example of countries like Ireland, where fuel duty has been cut by 17p for petrol and 13p for diesel.

“We’ve seen governments trying to alleviate this situation and we’re urging the chancellor to do all he can,” he said.

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