The £6 gallon has arrived: Price of petrol hits historic high

Cost has risen 7p a litre since the start of the year

Fears that Middle East turmoil will push the fuel prices even higher



Petrol prices have broken through the £6 a gallon barrier for the first time in history.

Soaring oil costs have pushed the UK’s average price of unleaded above 132p a litre, figures from the AA reveal.

As some experts predicted the price could hit £7.50 a gallon, the motoring organisation branded the £6.00 mark ‘another milestone along the road to higher fuel prices’.

Up again: Soaring oil costs have pushed petrol to a £6 per gallon record high

It means the pump price of petrol now averages 132.12p a litre while the average price of diesel also hit a new record at 137.92p – a staggering £6.27 a gallon.

But the average figure disguises the fact that some motorists in more remote regions, including parts of Scotland, are paying in excess of £1.40 a litre.

The cost of petrol has risen by 6.93p a litre (£3.47 per average tank) since the start of the year, and 1.68p a litre in the past week.

It also means ‘Mondeo Man’, the archetypal swing voter with a 70-litre tank, now faces paying £92.48 for a fill-up.

HOW THE CHAOS IN LIBYA HITS EUROPE HARDEST

Europe is most affected by the loss of Libyan oil exports. About 32 per cent of its oil goes to Italy, 14 per cent to Germany, 10 per cent to France and China and 5 per cent to the U.S.

Furthermore, Libyan oil accounts for about 23 per cent of Ireland's oil and about 22 per cent of Italy's.

Buyers have said the shortage can be covered by alternative sources such as Nigeria and Azerbaijan, which produce similar light, low-sulphur crude oils.

Saudi Arabia is pumping around 9million barrels per day and has spare capacity of around 3.5million barrels per day. The kingdom has promised to fill any supply gap caused by the unrest in Libya although it produces heavier crude with higher sulphur content than Libya.

Motoring groups fear there is far worse to come as oil prices soar on the back of instability in the Middle East.

Major car companies are already planning for prices of more than $170 a barrel, though some analysts and speculators have predicted $200 a barrel.

And holiday firms are already imposing hefty fuel surcharges that add up to £160 on a family holiday.

Breaking the £6 a gallon threshold puts more pressure on Chancellor George Osborne to axe in this month’s Budget a planned 1p plus inflation duty rise set for April 1 which would add another 5p a litre – or 23p a gallon.

The AA said that a year ago a litre of petrol, on average, cost 114.30p or £5.20 a gallon. Diesel at that time was 115.31p a litre or £5.24 a gallon.

For a family with two petrol cars, the monthly cost of fuel has risen from £242.70 in March 2010 to £280.54 now.



In the same period, the price of oil has risen from around $85 a barrel to $113. AA president Edmund King said: ‘The £6 a gallon is not just another milestone along the road to higher fuel prices, it marks the point at which the wheels start to come off mobility in 21st century UK.

‘Lower-income drivers, poorer rural residents, volunteer drivers, youngsters looking to their first jobs are some of the vulnerable groups struggling to stay on the road’.

Under pressure: George Osborne may axe a planned 1p plus inflation duty rise

‘Middle East troubles have brought matters to a head, but the writing’s been on the wall for months.’

RAC motoring strategist Adrian Tink said: ‘Another day, another fuel price record. Now we see the average price of petrol hit the £6 a gallon barrier with no end in sight to the spiralling prices.

‘It’s time for the Government to act by cancelling the planned fuel duty rise of inflation plus 1p in April. Something has to be done to control the price of fuel before driving becomes solely the preserve of the rich.’

The British boss of one of the world’s biggest carmakers said he has already made contingency plans for oil to soar to $170 a barrel – which could push prices up to £7.50 a gallon.

Nick Reilly, president of General Motors Europe and chief executive of British-based Vauxhall-Opel, said his company has planned a response in case the Middle East oil crisis gets worse and seriously disrupts supplies.

If his ‘worst case scenario’ planning strategy actually happens, that could see petrol prices rising by up to 30p a litre – or £1.36 a gallon.

The economic rule of thumb is that every $2 rise in the oil price adds 1p a litre at the pumps so with oil now at $110, a rise of $60 would add 30p a litre.



