Petrol costs up as oil prices rise
Updated on 16 April 2008
Motorists face having to fork out yet more for petrol after oil prices reached a new high near 114 US dollars.
Drivers across the UK paid a record average of 107.94p for a litre of unleaded on Monday, according to the AA. Diesel also cost a record 117.13p - or £5.32 a gallon.
The new highs were revealed as the price of a barrel of oil jumped to 113.93 dollars a barrel on the world commodity markets before settling back 50 cents.
In the UK, the average price of unleaded petrol is now close to the £5 a gallon mark that was breached by diesel more than a month ago. It means the cost of filling up a typical 50l family petrol car is around 16% or £7.63 higher than last year, with a diesel version 23%, or £11.09, dearer to fuel.
AA spokesman Luke Bosdet said car-dependent people living in rural communities and lower income drivers were the hardest hit by the rises - the latest in a series that have hit household budgets.
Mr Bosdet said: "For the majority of motorists, they are absorbing the extra cost into their budgets. But for the lower income driver who relies on their car, it's really beginning to bite."
If maintained, the current record crude prices are weeks away from filtering through to the forecourts.
The cost of light, sweet crude for May delivery rose nearly two dollars on the New York Mercantile Exchange as investors switched from the weaker dollar to commodities. The price has surpassed the previous trading record of 112.21 dollars set last week.
Brent crude futures in London also broke new ground during the session, reaching 111.91 US dollars. Crude oil's run above 100 dollars a barrel for much of this year has been largely blamed on a steadily weakening US currency which prompts investors to seek a safe haven in hard commodities such as oil and gold.
Mark Pervan, senior commodity strategist at the ANZ Bank in Melbourne, Australia, said: "We've seen another swing down in the US dollar so I think we saw short-term traders go back into oil as a hedge against the falling dollar."
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