Chancellor George Osborne looks set to bow to pressure by scrapping the fuel duty rise due to come into force in April.
With the price of oil and the VAT hike pushing up pump prices Osborne is on the verge of cancelling the 1p a litre increase,
Osborne told the BBC the Government could “do something” about the planned increase in the Budget on 23 March.
“We can override it, we are looking at that,” he said.
Motoring groups have lobbied the Government to scrap the duty rise as the average cost of a litre of diesel hit 130.6p in January while unleaded petrol rose to 126.1p.
Fuel duty on petrol already amounts to 58.95p per litre.
Osborne said he was looking at the idea of a fuel stabiliser to enable the Government to protect motorists from the effects of fuel price rises by cutting duty levels.
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