Drivers pay £5 extra per tank of petrol due to falling value of the pound | UK News

Drivers are paying an extra £5 per tank of petrol due to the fall in the value of the pound, according to new analysis.

Savings on pump prices resulting from oil prices returning to pre-Russian invasion levels in Ukraine are being “severely undermined” by sterling’s weakness, the AA said.

This week the the value of the pound fell to a 37-year low of $1.09.

The motoring organization has calculated that the price of petrol on UK forecourts would be ‘at least’ 9p per liter cheaper if the pound had maintained its value of $1.35 in mid-February.

The difference in price at the pump adds around £4.95 to the cost of filling a typical 55-litre family car.

Are low interest rates gone forever? How much will the tax cuts save me? Answers to your questions

Petrol averaged 164.8p a liter at the start of the week, down from 173.5p in mid-August.

But the 8.7p drop is less dramatic than the 15p reduction between mid-July and mid-August.

The average diesel price fell by 12.5p between mid-July and mid-August, before falling a further 3p to 181.3p at the start of the week.

AA fuel price spokesman Luke Bosdet said: “The influence of the exchange rate is often overlooked when drivers compare oil price movements with those at the pump.

“At the moment it is critical. Oil and fuel in the commodity markets are traded in dollars, which makes the weaker pound very bad for motorists.

Read more:
The key announcements of the mini-budget

The top 1% are immediate winners in the mini-budget
How much stamp duty will homebuyers pay now?

“Petroleum is back to where it was at the start of the war in Ukraine but petrol is 15p a liter more expensive.

“Two-thirds of this higher cost is due to the weaker pound.”

Mr Bosdet added that it is possible to buy petrol at around 10p a liter below average prices by finding a “competitive forecourt” selling the fuel for less than 155p a litre.

Subscribe to the Daily podcast onapple podcast, google podcast, Spotify, Loud speaker

The US currency has been strong against the pound for months.

The latest crisis comes as Chancellor Kwasi Kwarteng revealed the biggest tax cuts in 50 years under a new economic package – a package that will be funded by a huge leap in government borrowing.

Leave a Reply

%d bloggers like this: