A cut in global oil production and the weaker value of sterling has pushed up pump prices for diesel and petrol, new analysis from the RAC shows.
The average price of diesel increased by more than 8p a litre in September and petrol by 4.5p as the cost of a barrel rose to almost $100.
Diesel increased from 154.78p at the start of the month to 163.11p by the close (8.33p) making for its fifth biggest monthly rise since 2000.
Unleaded went up from 152.49p to 157.01p (4.52p), its 13th biggest monthly jump in price in the last 23 years. This is on top of rises drivers suffered in August, when petrol went up by nearly 7p and diesel by another 8p.
The increases mean it now costs nearly £90 to fill up a 55-litre family diesel car – around £4 more in a month, and the highest cost since April – and more than £86 for a similar petrol car, an increase of over £2 in September and the highest cost since December 2022
Price rises, says the RAC, are being driven by oil producer group OPEC+ restricting global supply in conjunction with the weaker value of sterling which makes wholesale fuel, which is traded in dollars, more expensive to buy in the UK.
Throughout September the cost of a barrel went from just under $89 to around $96 which added 8p a litre to the wholesale price of diesel. The last time oil was traded for over $100 a barrel was at the end of August 2022.
RAC fuel spokesman Simon Williams said: “Drivers are sadly really starting to suffer again at the pumps with September seeing another 8p a litre added to the average price of diesel which comes hot on the tail of a similar increase in August.
“Petrol has also gone up 11p since the beginning of August so there’s little respite whichever fuel drivers use.”
Analysis of RAC Fuel Watch wholesale and retail data shows that petrol is currently overpriced by around 7p a litre, although the price of diesel is likely to go up further still in the coming weeks.
“It’s worrying that retailer margin across the UK is higher for petrol than it should be considering the big four supermarkets were told off by the Competition and Markets Authority for overcharging drivers by £900m in 2022,” continued Williams.
“While many have voluntarily started to publish their prices ahead of being mandated to in law, we still have a situation where wholesale price changes aren’t being fairly reflected on the forecourt.
“In the last two weeks the wholesale cost of diesel has become 10p a litre more expensive than petrol, yet the gap at the pumps is only 5p.
“If retailers as a whole were playing fair with drivers petrol would be at least 7p cheaper than it is now, down to around 150p from its current average of 157p.”
The second recommendation from the CMA report was to set up a price monitoring body. Williams says that the current situation demonstrates why this is needed as some retailers are “clearly inflating the price of petrol”.
“The setting up of this body cannot come soon enough, as long as it has some form of teeth to keep retailers in line,” he added.
*Article Source www.rac.co.uk