The cost of filling up a family car in the UK increased by about £2 this month as the jump in the oil price caused by the Red Sea attacks is felt at the pumps.
In the three weeks to 18 February petrol increased by 3.2p to 143.4p a litre, while diesel rose by 4p to 152p, according to the RAC, which said this was “worrying” for motorists.
The financial pressure on petrol car drivers had been easing over the last three months, as the price had fallen back from 157p to below 140p in mid-January. This was the first time it had dropped below this figure since October 2021, when the energy crisis began to escalate. Russia’s invasion of Ukraine in February 2022 then pushed up fuel prices to record levels.
While the price of diesel had reduced by 15p, from 163p in early October to just below 148p in late January, it was cheaper for much of last summer.
The pump price increases have been brought about by a jump in the price of oil, which has been trading above $80 a barrel for most of the past four weeks, having been well below that for the previous seven.
The Red Sea attacks by Houthi rebels, which are forcing tankers to avoid the Suez canal and instead go round South Africa’s Cape of Good Hope, was one of the reasons for the increase, the RAC said. However, the closure of refineries for maintenance, as well as UK retailers buying more fuel stocks before the budget to protect against a possible fuel duty hike, were also factors.
Simon Williams, the RAC fuel spokesperson, said: “News that fuel prices have bottomed out and are now on the rise again is bad news for drivers, and possibly the economy and future inflation rates, too.
“While we’re not expecting prices to shoot up dramatically, it appears that oil is trading up, which in the absence of a stronger pound means wholesale fuel costs more for retailers to buy in. The result is higher prices at the pump and more expense for the everyday driver.”
The RAC does not expect forecourt prices to climb much higher “but a lot depends on how much margin the biggest retailers decide to take”, he said. “Supermarket margins are lower than they were in January, but they are still significantly higher than they were prior to the pandemic and Russia’s invasion of Ukraine.”
Retailers have faced scrutiny over how quickly they pass on rises and falls in the wholesale price of fuel. Last year, the government accused station owners of treating motorists as “cash cows”. To remedy the situation it is forcing companies to provide live pricing data, allowing drivers to shop around more easily for the best deals.
