UK petrol prices rise to three-year high

The average cost of a litre of unleaded petrol has gone up for the second month running

The RAC said it was hard to see pump prices getting much cheaper in the early part of this year (iStockphoto)

Motorists will start the new year by paying the highest petrol prices for three years, largely as a result of soaring oil prices, according to the RAC.

The average cost of a litre of unleaded petrol went up for the second month running from 120.66p to 121.11p - its highest since December 2014. Diesel also rose from 123.06p to 123.46p per litre.

RAC fuel spokesman Simon Williams said the price rises have been driven by the increased cost of oil which has gone up to $66.61 per barrel - its highest since May 2015.

“December was the month oil reached its highest point for over two and a half years – something which motorists are now feeling the effect of at the pumps,” he said.

Mr Williams said that it was hard to see pump prices getting much cheaper in the early part of 2018.

“Unfortunately, the good times of lower-cost fuel appear to be over and it’s probably now far more likely that we will see them going up as OPEC’s oil production cuts are starting to have the desired effect of reducing the global oil glut and pushing the barrel price higher,” he said.

There was some good news for motorists though, as the closure of the North Sea Forties pipeline did not lead to the price of oil increasing as many analysts had forecast, Mr Williams said.

The Forties pipeline – which supplies over half a million barrels a day to the UK market – was shut down for repair in December after a crack was found in a section of pipe.

“It had been feared this would lead to petrol and diesel going up in the run-up to Christmas, but luckily for drivers global oil production was not negatively affected as a result,” Mr Williams added.

To fill up an average 55-litre family car with unleaded now costs £66.61 – £3.73 more than it did in July. For diesel, a full tank now stands at £67.90, up by £4.64 from the summer.