UK Petrol retailers warn of record prices at the pumps within days

A petrol station in East London, on Saturday.

UK petrol retailers have warned that prices at the pumps could hit record levels by the end of the month, adding to the cost of living squeeze.

Brian Madderson, chairman of the Petrol Retailers Association, says that the previous records are “almost certain to be eclipsed before the end of October”.

Back in April 2012, petrol hit a record high of 142p per litre while diesel reached 148p per litre.

Prices are nearing that level, the PRA warns, with Experian Catalist UK averages hitting 141.35p per litre for petrol yesterday, and 144.84p per litre for diesel.

Madderson says this increase is being driven by higher oil prices. Brent crude hit a three-year high over $85 per barrel last week, up from around $51 at the start of the year.

The primary reason is the rise and rise of crude oil costs which recently hit $85 per barrel for Brent Crude.

This involves more than a 50% increase since January 2021 and has been caused by a cutback in production from OPEC countries and Russia at the same time as the global economies are staging a rapid economic turnround from the global pandemic. There is no immediate sign of a change to this position and some analysts have talked about further oil price rises to $100/barrel by Christmas.

The Opec+ group slashed production last year, and is sticking to its policy of gradually increasing production by 400,000 barrels per month – despite the White House urging them to pump faster.

Madderson adds that motorists haven’t seen the full impact of rising oil prices:

Current average pump prices across the UK are being softened by some of the largest retailers who typically benefit from a 3 or even 4-week lag to their delivered fuel prices.

Last week, AA data showed that petrol had hit 140p for the highest since the record levels in 2012 (on a nominal basis, not adjusted for inflation). – The Guardian, London