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Petrol prices reach an eight-year high. But are prices set to rise further?

By Tom Gibson | August 10, 2021

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After nine months of successive price rises us motorists should not be surprised that petrol prices have reached an eight-year high. The RAC has warned prices could rise further.

Petrol prices reach an eight-year high. But are prices set to rise further?

In its monthly analysis, RAC said the average price of a litre of petrol is now 135.13p, the highest since September 2013, as rising oil prices push up fuel costs.

The news for diesel owners isn’t much better with an average of 137.06p a litre, meaning it’s at its highest price since 2014.

"Prices really are only going one way at the moment - and that's not the way drivers 

want to see them going," warned RAC fuel spokesman Simon Williams.

The latest RAC Fuel Watch figures show that another 3.4p was added to a litre of petrol in July, the largest rise in the price of unleaded since January, while diesel climbed 2.7p a litre.

A driver filling up a petrol car with a 55-litre tank now pays on average £3.08 more than at the start of June, and £11.47 more than a year ago.

For diesel drivers filling a similarly-sized tank, it now costs £2.90 more than at the start of June, and £10.46 more than it did at the end of July 2020.

Petrol prices reach an eight-year high. But are prices set to rise further? Image

Will prices continue to rise?

Yes, to be blunt. A global recovery is seeing global trade pick up, therefore increasing the demand for oil, And as demand outstrips supply wholesale fuel prices are pushed up, which has a knock-on effect for motorists.

"While we're not past the pandemic by any means, demand for oil is likely to continue to increase as economic activity picks up again, and this is likely to have the effect of pushing up wholesale fuel prices, costs which retailers are bound to pass on at the pumps," Mr Williams said.

He warned that unless major oil-producing nations decide a new strategy to increase output, forecourt prices could climb even higher towards the end of the summer.

Despite the recent price increases, petrol prices are yet to reach the highest level we saw in April 2012 where prices peaked at 142p a litre for unleaded and 148p for diesel. 

 

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