Scots hit by soaring fuel costs 21 | 01 | 2011
SOARING PETROL PRICES across Scotland are causing families to cut back on spending in other areas, and the AA has warned the Government that it has to act quickly before fuel costs spiral even higher.
As the average price of a litre of diesel in Scotland hit 133.2p, the AA confirmed that UK petrol prices ended the first decade of the 21st century with their biggest monthly leap – up by a staggering 6.13p/litre or £3.07 a tank.
Between mid-December and mid-January, UK average petrol prices rose from 122.14p/litre to a new record of 128.27, while diesel prices went up 6.56p a litre, from 126.19p/litre last month to 132.75 now.
The previous highest monthly petrol price increase since 2000 was 5.6p a litre in June 2008. In May 2008, monthly diesel prices soared 6.8p/litre, leading to the 133.25p record in July 2008, which still stands – just.
A 0.76p a litre increase in fuel duty on January 1, allied to VAT rising to 20%, added around 2.5p more to the pump price and accounted for the lion's share of the latest increase. However, an increase of around 5% in wholesale costs, driven by oil prices surging past $90 a barrel, have ensured that every day has been a record for petrol prices since 10 December 2010.
Compared to a year ago, petrol now costs 16.3p/litre more and diesel 18.98. Filling a typical 50-litre fuel tank has risen — £8.15 for petrol and £9.49 for petrol. For a two-car family, the monthly cost of petrol has increased by £34.61.
Concerningly for the Government, its own figures show a 3.4% fall in petrol sales in the third quarter of 2010 compared to the same period in 2009. A comparison of retail petrol sales from January to September 2010 with the same period in 2007 shows a 2.22 billion-litre or 12.8% decline.
Looking at combined sales of petrol and diesel, UK retailers in the first nine months of 2010 sold 1.27 billion fewer litres compared to the boom time in 2007 – echoing the £0.2 billion loss of tax revenue from 2009/10 fuel receipts predicted by the Labour government in its 2009 Pre-Budget Report.
"The huge fall in petrol sales shows that many drivers cannot afford to fill up. AA/Populus research shows that two-thirds of drivers are cutting back on car use, other spending or both," Edmund King, the AA's president said today.
"Unless the Government can restore a more affordable level of fuel prices, by scrapping the fuel duty increase in April and bringing in a fuel price stabiliser, the falling tax return from constantly rising prices will reduce the income to the Treasury. Sooner or later, politicians will have to face reality – more and more drivers cannot afford these prices, they are pushing up inflation and taking money from other consumer spending."
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Jim McGill