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July sees rise in fuel prices, RAC reports

Date: 06 August 2019   |   Author: Sean Keywood

The price of petrol and diesel rose in July, according to data from the RAC.

The motoring organisation says the average price of a litre of petrol went up by 1.55p to 129.21p, while diesel went up by 0.93p to 131.95p. 

Despite the increases, both fuels were still cheaper at the end of July compared with the start of June, after a big drop in prices in the previous month.

The RAC said that a major factor in July's increase was a 3% drop in the value of the pound against the dollar, with oil traded in the latter currency.

It said the monthly increase could have been higher, since the price of a barrel of oil hit a high of more than $67 in the middle of July, but by the end of the month it had fallen back to just under $64.

RAC spokesman Simon Williams said: "While there were only relatively small rises in both petrol and diesel, the situation might have been far worse if the drop in the value of the pound had combined with the higher mid-month oil prices. And, of course this could still very easily prove to be the case if the pound doesn't recover in the next few weeks. 

"The price of a barrel of oil has been fluctuating between $60 and $70 since the end of May as traders can't seem to be able to get a clear understanding of what's happening with global demand. 

"On the one hand there is talk of an economic slowdown in China and, on the other, concerns about supply due to the tanker hijacking issues in the Strait of Hormuz through which a third of the world's sea-borne oil supply is shipped. 

"Drivers can only hope we don't see the nasty combination of a rising oil price and a falling pound. If we do, August could prove to be a very costly month on the UK's roads."