Price of petrol falls for fourth consecutive month
Unleaded finished the month at 107.82p, down from 109.45p at the start, slashing another 90p off the cost of filling up an average 55-litre family car.
This means since the start of July it costs £5.08 less to fill up with unleaded and £5.87 less for diesel.
The price of diesel only reduced fractionally in October from 110.26p to 109.95p but is still not far off the lowest price since December 2009 which was recorded in the first week of September at 109.76p.
The continued run of lower fuel prices is being driven by the oil price which remains below $50 per barrel despite a 2 per cent increase throughout the month.
The October RAC Fuel Watch report showed a barrel of crude maintained an average price of $48 per barrel, although there was greater fluctuation in October than in previous months. The month featured a five-day spell in which a barrel went over $50 and a dramatic dip towards the end of the month when a barrel hit $45.95 (27 October). The latter is almost as low as mid-January ($45.26) when petrol was the lowest it had been for six years (106.09p).
The pound made 2 per cent gain on the dollar ($1.51 to $1.54) helping to keep the wholesale price of petrol and diesel lower as both fuels are traded in dollars. The RAC is currently expecting little change in pump prices over the next fortnight.
“We are currently enjoying a sustained period of lower fuel prices as a result of the long-term deflated oil price which has been brought about by OPEC [Organisation of the Petroleum Exporting Countries] looking to stop competitors taking its share of the market by overproducing and keeping the barrel price low,” said RAC fuel spokesman Simon Williams.
“A year ago, motorists had become accustomed to only ever seeing prices go up, so having four consecutive months of the petrol price coming down is a pleasant surprise. Fuel is without doubt the biggest cost of motoring and the forecourt price is a constant cause of concern for drivers which makes this relief at the pumps all the more welcome.
“The question is how low will prices go, albeit with the caveat two-thirds of every till receipt is made up of tax through fuel duty at 57.95p a litre and VAT on top. And, as prices head towards the £1 mark, the tax take rises to 75 per cent.”