Calls for an end to THEWELSH petrol price postcode lottery; While the price of oil continues to fall globally, a discrepancy of as much as 30p a litre remains in place on forecourts around Wales. Sion Morgan and Jake Burman analyse the statistics as experts predict prices could soon drop to PS1.05 a litre.
The startling contrast in forecourt costs is revealed as concerns continue to be raised over plunging crude oil prices, which are not being mirrored on every fuel station forecourt. In a quick price survey yesterday, we found prices ranging from as little as 114.7p per litre at Asda in Leckwith, Cardiff, and 114.9p at Cardiff Bay's Esso garage, to 142.9p at the Murco station in Llanelli's Sandy Road.
On average, Britain's motorists are now paying 120p for a litre of regular unleaded fuel, even though global oil prices have fallen by 40% since July.
A barrel of oil currently costs $68 and petrol prices have dropped 6% compared to this time last year, according to government figures.
But the RAC believes there is scope to reduce petrol prices by more than 7p a litre and diesel by nearly 6p.
The motoring organisation has called on fuel retailers to pass on further savings in the wholesale price brought about by the continued fall in world oil prices.
"This overdue cut would reduce the biggest cost of motoring just in time for Christmas," a spokesman said.
The organisation is suggesting reductions would bring the average price of a litre of petrol to 114p and diesel to 120p - prices last seen across the country in March 2010.
RAC fuel spokesman Simon Williams said: "The tumbling oil price, coupled with a pound that is still strong against the dollar, have led to a phenomenon that many motorists are pretty unfamiliar with - falling pump prices.
"The forecast reduction that retailers should be passing on is the biggest the RAC has seen in recent years, even since petrol began to come down from its record high of 142.48p a litre on April 17, 2012 (diesel 147.93p, April 13, 2012).
"Retailers now have a very reasonable record on transparent pricing so we have no reason to believe that they will not pass on the savings in the wholesale price, we just urge them to do it sooner rather than later to make the point very clearly to motorists that they operate a fair pricing system.
"If they do, we could well see petrol pump prices fall by well over 7p a litre in the next few weeks and diesel by almost 6p a litre."
With this kind of drop in national average prices, motorists would be expected to see some very low petrol prices - perhaps under 110p a litre from retailers who pride themselves on having the lowest prices, he said.
Mr Williams added: "At a petrol price of 114p a litre, motorists would be saving over PS9 (PS71.93 down to PS62.70) on filling up an average 55-litre family car compared to the beginning of the year; PS10 for a diesel at 120p a litre (PS76.03 down to PS66).
"This will be very welcome news just in time for Christmas when household budgets are really stretched.
"It should also be another boost for business as it will lower operating costs substantially.
"While motorists are enjoying much lower forecourt prices, it's important to recognise that they will always be limited by fuel duty, which represents nearly 58p in every litre, and VAT which is charged on top, at around 20p a litre.
"A driver filling up a 55-litre petrol car at 114p a litre would therefore pay PS62.70 of which PS31.87p would be duty, PS10.45 VAT and only PS20.38 for the fuel itself."
Kevin Daly, meanwhile, a senior economist at Goldman Sachs, believes plummeting oil prices will cause the cost of unleaded at the pumps to fall to a level not seen since summer 2009.
He believes the price will drop to PS1.05 a litre in coming months which will give a welcome boost to people's wallets and consumer confidence, especially with wage growth stagnant.
Mr Daly told the Treasury Select Committee on Tuesday that "the men and women of Britain will really notice things such as the sharp decline in oil prices."
He added: "If prices remain at these levels, we're likely to see a litre of unleaded petrol fall to between PS1.05 and PS1.10 per litre.
"That is a significant decline and I suspect they will notice that more than they will the concerns over global growth."
Last week, in the Autumn Statement, Chancellor George Osborne UK said fuel duty will stay frozen at 58p per litre for petrol and diesel, amid the tumbling oil prices.
If the price did fall as predicted, it would mean more than half of the price of unleaded would be made up of tax.
Motoring group the AA has already pointed out that petrol sales have fallen 20% compared with the same period five years ago.
As such, Treasury receipts from fuel are under pressure.
The AA cites high fuel prices as the reason behind falling sales volumes.
"Price spikes and high fuel duty levels have forced drivers to cut back on car use for so long that the habit has stuck," the group's president Edmund King said.
With oil prices estimated to fall further it remains to be seen if Welsh motorists will see an end to the petrol pricing postcode lottery.
Prices on some forecourts of 114p per litre of unleaded have not been seen since 2010 <B
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|Publication:||Western Mail (Cardiff, Wales)|
|Date:||Dec 11, 2014|
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