Fuel prices to fall to lowest in three years
Low global demand and exchange rate bonus sees pump prices ease - but there’s a budget looming…
Drivers should already have noticed recent falls in the price of petrol and diesel, but RAC Fuel Watch says there should be more good news on the way.
At the end of last week, the average price per litre of unleaded was 136.15p, which represents a 5p price cut compared with the beginning of September, when drivers were forking out 141.26p on average. It’s a similar story with diesel, which has fallen from an average of 145.99p to 140.87p over the same period, meaning both fuels are now the cheapest they’ve been in almost three years.
Petrol and diesel prices haven’t dropped this quickly over the course of a month since December 2023, but that was from a considerably higher baseline. Now, the RAC is predicting that prices will drop to a three-year low by the end of September, and says average prices could fall to 132p and 138p for petrol and diesel respectively within the next couple of weeks.
However, there’s a potential cloud on the horizon, in the shape of the Labour Government’s autumn budget, which is due to be presented to Parliament on 30 October. Many pundits have suggested motorists could be in chancellor Rachael Reeves’ firing line, because Labour politicians from Sir Keir Starmer downwards have repeatedly refused to rule out a return to the days of the feared ‘fuel price escalator’, when drivers faced annual tax hikes at the pumps to bolster the government’s spending plans.
Until then, the RAC is urging drivers to shop around for the greatest savings. Depending on where they fill up, drivers can find prices well under the average, the organisation says. Supermarkets are currently charging 133.23p for unleaded and 137.69p for diesel, it reports, while in Northern Ireland a litre of petrol costs 131.5p and diesel 134.2p.
The current relatively low fuel prices are a result of low consumer demand globally, and a strengthening pound, which means wholesalers get more bang for their buck, because oil is traded internationally in dollars.
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