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The cost of fuel is set to rise as wholesale prices increase

Rebecca Goodman
Written By:
Rebecca Goodman
Posted:
Updated:
03/02/2023

The price of petrol has been falling for the last three months to a low of 148.35p in January, but has now started to rise again.

It fell by 3p in January, from 151.85p, and at one point in the month was 3.5p cheaper, according to data from the RAC.

The last time prices of petrol were this low was a year ago, just before the invasion of Ukraine in February 2022. The average cost of a tank of petrol is now £81.89, £1.63 cheaper than a month ago.

The average cost of diesel fell 4p from 174.37p to 170.37p, a price last seen in March 2022. It means a tank of diesel is now £93.70 on average, £2.20 less than a month ago.

Prices predicted to rise again

It is predicted prices will begin to rise as wholesale figures increased by 2p for petrol and 3p for diesel in January.

There are also predictions the price of oil will rise, from $80 to $90 for a barrel due to an increased demand as China reopens after ending its zero-covid policy. At that point, petrol prices could go back up to an average of 155p, according to the RAC.

It is urging the Chancellor to refrain from hiking fuel duty in next month’s Spring Budget.

Supermarket fuel is 3p cheaper

Filling up a car at one of the big four supermarkets was an average of 3p a litre cheaper for petrol and diesel in January and they have not yet passed on hikes to the wholesale price.

The average price of petrol was 145.71p, a fall of 2.25p, while diesel was 167.49p, a fall of 2.79p, at one of the four big supermarkets.

The cheapest was Asda, with a litre of unleaded petrol costing an average of 144.61p (down to 2.5p) and diesel 166.09p (down 3.6p).

The cost of fuel was generally cheaper in the North West, North East, Wales and Scotland, while the RAC said Northern Ireland remained an anomaly, being 4p cheaper than the UK average.

“Diesel is still too expensive”

Simon Williams, RAC fuel spokesman, said: “Although January saw fuel prices fall for the third month in a row, there is now more cause for concern than celebration as petrol has already begun to creep back up very slightly.

“Monthly reductions of 3p for petrol and 4p for diesel were welcome but sadly the first month of the year saw the wholesale price of petrol rise by 2p and diesel by 3p.

“Despite this, while unleaded has been overpriced for months due to the biggest retailers refusing to lower their prices in line with the lower wholesale price, diesel is still too expensive even after factoring in the slight wholesale uptick.”