UK Fuel Prices See One Of The Largest Monthly Increases In 23 Years

UK drivers experienced a big shock at the pump in August as the prices of gasoline and diesel saw some of the biggest monthly jumps in 23 years amid rallying international crude oil prices, RAC, the UK’s longest-serving motoring organization, said on Monday.

The price of gasoline in the UK rocketed by nearly 6.68 pence per liter in August while diesel shot up by 8 pence, making for the fifth and sixth biggest monthly rises in 23 years, data from RAC Fuel Watch shows.

The average price of unleaded gasoline made filling up a tank $5.05 (£4) more expensive in August compared to July, while the price of diesel at the end of August made a fill-up $5.57 (£4.41) more expensive, RAC said.

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“The rising prices at the pumps have been caused by the increasing cost of oil, which has gone up nearly $12 since the start of July to nearly $87 a barrel now, due to producer group OPEC+ reducing supply,” RAC said.

“This led to the wholesale cost of fuel – the price retailers pay – going up, which in turn has been passed on to drivers on the forecourt,” the organization noted.

RAC fuel spokesman Simon Williams commented, “August was a big shock to drivers as they had grown used to seeing far lower prices than last summer’s record highs.”

At the start of September, crude oil prices hit the highest level so far this year amid a tightening market and expectations that Saudi Arabia and Russia would extend their supply cuts into October.

WTI exceeded $85 per barrel and Brent topped $88 a barrel on Friday and continued to trade above those levels in Asian trade on Monday. Meanwhile, gasoline prices in the U.S. also climbed.

Despite the higher WTI price, gasoline prices in the United States could fall in the coming weeks, Patrick De Haan, head of petroleum analysis at GasBuddy, said on Friday.

“WTI crude surpasses $85/bbl, the highest level since November, but the outlook for #gasprices is still for an eventual fade that will start with the switch back to cheaper winter gasoline which happens on September 16,” De Haan tweeted.

Source: Oilprice.com