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Fuel prices at highest level since the summer of 2015

Thursday 05 January 2017, By Autovolo

Fuel prices at highest level since the summer of 2015

Fuel prices at highest level since the summer of 2015

Average fuel prices hit an 18-month high in December thanks to rising oil prices, according to the RAC.

The motoring organisation’s data showed that petrol cost an average of 117.23p per litre on December 29 – an increase of almost 3p compared with the December 1 price of 114.24p per litre.

Diesel prices also rose by around 3p per litre, with the average litre costing 119.63p at the end of December, compared with 116.56p on December 1.

The RAC claims the rising price is a result of increased crude oil prices caused by the Organisation of Petroleum Exporting Countries (OPEC) announcement that production will be cut. This forced prices up from $49.09 per barrel on November 30 to $54.86 per barrel on December 30.

That price represented a doubling in the value of a barrel of crude oil between January 1 and December 30, 2016.

Such a massive shift has naturally been passed onto consumers, so the average litre of unleaded was 14.5p more expensive at the end of December than it had been at the beginning of January. Diesel prices were 13.64p higher per litre.

RAC fuel spokesman Simon Williams said: “The rising oil price is bad news for motorists as it caused a nasty jump in pump prices in the most expensive month of the year. The big question now is how much further are they likely to go up, particularly in the long January wait to the next payday.

“So far, the price rises we’ve seen are purely down to the announcement at the end of November that OPEC and non-OPEC countries would be cutting oil production this month. Everything now depends on the strength of the deal and each country sticking to the agreed production levels. Russia will be of particular interest as it is currently producing at near-record levels.

“We are optimistic that prices will not increase by another 3p a litre in January based on what’s going on with oil and wholesale fuel now, but if in the months ahead the barrel price was to get nearer to $60 and the pound was to weaken further then that would be the worst possible combination for motorists. We need the pound not to lose any more value against the dollar as fuel, like oil, is traded in dollars.”