Petrol and diesel prices fell by an average of 2.5p per litre in March, according to the latest figures from the RAC. The slide was kicked off by supermarket price cuts, which followed a $3 per barrel fall in the price of oil last month.
For the second month in a row, the North East of England saw the lowest fuel prices of all, with average prices falling to 116.50p for petrol and 118.53p for diesel at the end of March. The South East remains the most expensive place to buy fuel, with an average price of 118.38p for petrol and 120.30p for diesel.
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The RAC says that the average motorist will save £1.40 per tank at the lower prices seen at the end of March. An average 55-litre family petrol car now costs £64.65 to fill up, with diesel slightly higher at £65.75.
Will prices fall further?
At the time of writing, the RAC’s FuelWatch service suggests that diesel prices may have further to fall over the next couple of weeks.
But the price of oil has already started to rebound, as evidence emerges that global levels of oil storage are falling steadily. Unless this trend reverses, I’d expect the price of oil to remain fairly firm and perhaps rise further as we head into the summer.
One other factor which could affect fuel prices is the exchange rate between the US dollar and the pound. Oil, petrol and diesel are all traded in dollars. If the pound rises against the dollar, fuel prices could fall. The exchange rate seems fairly stable at the moment, at about $1.24/£1, but this could start to change later this year.
simplemotoring.co.uk fuel outlook: Nothing is certain, but we think fuel prices are likely to edge higher as we head into summer.