The price of diesel and unleaded petrol rose by 2p a litre in January to the highest level since 2015, according to the RAC.
After rising by an average of 3p in December, the RAC said that unleaded petrol rose by by an average of 2.15p to 120.05p during January.
Diesel climbed an average of 1.99p to 122.34p per litre.
Supermarket fuel remained cheapest, but the gap is shrinking according to both the AA and the RAC. New figures from the AA shows that supermarket fuel was an average of 2.5p per litre cheaper in January, down from 3.2p per litre in December.
Will prices fall?
What’s worrying is that the RAC says that these increases were not matched by increases in the wholesale cost of fuel. According to the RAC’s latest Fuel Watch report, the wholesale cost of unleaded petrol remained flat in January, while the cost of diesel actually fell.
The higher price of petrol and diesel was a result of an increase in the cost of crude oil following OPEC production cuts. But this increase seems to have topped out for the time being, in my opinion. If the exchange rate between the pound and the dollar stays stable, fuel prices should flatten out for a while.
Indeed, the RAC expects to see prices fall over the next few weeks. Simon Williams, the RAC’s fuel spokesman, reckons prices may fall slightly this month:
“As the wholesale price stands currently we would be expecting to see average prices come down by over a penny a litre in the next fortnight.”
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