UK oil prices are expected to rise for a seventh consecutive month after hitting a two-year high over the weekend.
The price of unleaded has averaged over 129p per liter, its highest level since June 2019, as rising crude oil prices come with growing demand from drivers. The price of diesel rose to 131.4p on average at the pump, the highest since January 2020, before the first containment of the coronavirus.
The steady rise in gasoline prices since November 2020 is one of the longest on record, and if sustained, the trajectory threatens to push the cost of unleaded gasoline to motorists to a seven-year high within a few weeks, according to figures from the RAC Foundation.
Fuel prices fell 20% during the 2020 lockdown, when fewer cars were on the roads but rebounded before what is expected to be the busiest automotive weekend of the year so far, the first public holiday after the easing of Covid restrictions on travel and overnight stays.
Small retailers have been hit hard, with the proportion of fuel currently purchased in supermarket forecourts reaching around 60% in the UK, up from 45% before the Covid-19 pandemic, according to the RAC fuel spokesperson. , Simon Williams.
“People have been more dependent on their cars but have not driven the miles – this has had the unfortunate effect of crushing small fuel retailers who have not been able to cope with the reduction in custom. . “
UK passenger car use fell to around a third of normal levels in the first lockdown, but has now practically returned to 2019 traffic levels, according to the latest Figures from the Ministry of Transport.
Steve Gooding, Director of the RAC Foundation, said: “In some ways the relentless rise in fuel prices is a positive sign as it signals a recovery in the economy and growing demand for travel. But that is hardly comforting to the vast majority of drivers who couldn’t afford to switch to expensive electric cars to purchase and who rely on fossil fuels to go about their daily lives.
The relative strength of the pound against the dollar, in which oil is bought in bulk, insulated UK drivers from larger gains. However, the price of a barrel of Brent crude fell back to just under $ 70 (£ 49.35) a barrel, from its low of $ 20 in April 2020, ahead of an Opec meeting on Tuesday where producers of oil will decide to increase production.
Williams said, “Because of the vaccination schedule, the reduced restrictions and people driving further, you have a greater demand for oil. The wholesale price could go up – it depends on whether Opec releases more oil to meet the increased demand around the world. “
Analysts expect Opec to stick to plans to gradually ease supply cuts through July. Meanwhile, Iran has said it could pump an additional 6.5 million barrels of oil per day, or about 7% of global demand, if negotiations with the United States over the nuclear deal allow for lift the sanctions on oil exports.