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Fuel prices rise for fifth month in succession

Date: 06 April 2021   |   Author: Sean Keywood

The cost of both petrol and diesel rose in March for the fifth month in a row at UK filling stations, according to the RAC.

It says the average price of a litre of petrol went up by 2.7p, to 126.28p, while the average litre of diesel was up by 2.4p, to 129.07p.

The latest rises mean prices are now up by 12.2p and 11.4p respectively since the start of November.

According to the RAC, prices would be  higher still were it not for the price of oil continuing to be held back by reduced demand due to the Covid-19 pandemic, as although the average barrel price has risen from a record low of $13.21 last April to $63.67 now, it would still have the potential to go much higher.

RAC spokesman Simon Williams said: "Pump price rises seem a little unrelenting at the moment with March being the fifth successive month where prices went up. This is very frustrating for drivers who are now starting to use their vehicles more with the easing of the national lockdown. 

"They're unfortunately suffering the effects of the rise in wholesale fuel prices that took place in February which led retailers to increase their forecourt prices almost daily throughout last month.

"The situation isn't as grim as it could be though as the combination of a relatively strong pound and an oil price that is pegged back by lower global demand as a result of the pandemic mean wholesale prices are still lower than they otherwise would be."

Williams added that those refuelling diesel vehicles were being especially hard done by.

He said: "Diesel is looking particularly overpriced at the moment, with the wholesale price of the fuel currently less than the petrol equivalent. Unfortunately, this rarely translates into lower prices as retailers tend to use the saving to subsidise the price of petrol.

"The coming weeks and months are critical when it comes to working out where prices might be heading during the rest of 2021. For as long as global Covid travel restrictions remain, it's hard to see oil prices rocketing - and that should protect wholesale, and in turn, pump prices from rising too quickly. 

"However, what the major oil producing nations decide to do in terms of oil output is also important. Any further reductions in supply could start to push the barrel price up above the $70 mark again - spelling yet more pump price rises here in the UK."