In the wake of the spending review, many thought it couldn’t get any worse. Unfortunately for the motorist it is going to get a whole lot worse.
Across the UK petrol prices have risen sharply after a slight decline during the summer. Petrol is now at an average of 117.75p a litre – a 2.5p rise on the mid-September price.
Diesel has gone up even more – increasing 3.28p to stand at an average of 121.30p a litre.
The bigger the demand, the bigger the price
Rising oil prices in early October plus a Government-planned fuel-duty rise on October 1 contributed to the petrol and diesel increase. A month-long blockade of Marseilles, one of France’s most important ports and main terminal, has forced the country to import fuel which has led to an increase in demand therefore an increase in prices throughout the continent.
Demand for oil also increases during the winter months because of the cold weather and that will contribute further rises in cost. With fuel duty set to rise again by 0.76p on 1 January and the standard VAT rate to rise from 17.5% to 20% from 4 January the immediate outlook is bleak and expensive for motorists.
Could 2011 see a return of the blockades that brought the country to a standstill in 2000? That blockade was led by lorry drivers and farmers stopping access to the oil refineries, panic buying led to many petrol stations across the country to run dry. Similar protests were launched in 2005 and 2007 but these did not have the desired impact.
A look across the UK
London remains the most expensive region for petrol, averaging 118.4p a litre, with Yorkshire and Humberside cheapest at 116.8p.
Wales has become the dearest region for diesel at 122.2p a litre while Yorkshire and Humberside motorists enjoy the lowest average price – 120.6p.
The Government plan to introduce a pilot scheme to discount the cost of petrol in the Highlands and Scottish islands by 5p a litre. Even though the average cost of petrol and diesel in Scotland is marginally lower than the UK as a whole, rural areas and islands have been subject to some of the highest prices, due to the added cost of transporting fuel. On Islay, for example, a litre of diesel can be as high as 133.3p, while a litre of unleaded is 132.1p.
The AA has stated that for UK families trying to digest the impact of Government cuts, this month’s £1.25-a-tank increase in petrol costs has added £5.30 to the monthly fuel spend of a two-car household.
Government figures show that the amount of revenue raised by fuel duties will increase by more than one-quarter over the next five years to £33.4 billion. The £26bn the Treasury currently earns from fuel duty is higher than tax raised through self-assessed income tax.
How to make a 20% efficiency saving on fuel
Research by MoneySupermarket.com shows that one in ten motorists are actually giving up driving all together, opting for public transport instead. The results also found a staggering two thirds of drivers admit that rising costs have taken their toll and are now changing their driving habits.
So for the motorist there has never been a more important time to tighten the purse strings. The cost of fuel show’s no sign of coming down, so it is up to each individual motorist to maje their own efficiency savings. The following tips will help you save up to 20% in fuel cost and help see you through 2011.
Hint | Explanation | Efficiency Saving |
Keep your tyres inflated | Lower tyre pressure increases the drag on a car meaning you need more fuel | 3% |
De-clutter your car | The lighter your car is, the less effort it needs to make to accelerate. | 2% |
Take your roof rack off | A roof rack, even unused, adds massive wind resistance to a car, increasing drag and making the engine work harder. | 2% |
Turn off the air con | Air conditioning also uses an incredible amount of fuel, so make sure it’s turned off unless you really need it. | 8% |
Don’t fill it up | Fuel is heavy, so by filling the car up you’re adding quite a weight. The less fuel your car has in it, the more efficiently it drives. | 1% |
Accelerate gradually without over-revving | When you press harder on the pedal more fuel flows, but you could get to the same speed using much less power – a good rule is to stay under 3,000 revs. | 2% |
Drive in the correct gear | Always drive in the highest gear possible without labouring the engine. | 2% |
Total | 20% |