Motorists are having to fork out more than 133p-a-litre on average for petrol as the cost of unleaded increased for a 32nd week in a row, says a figures out today.
The AA says a litre of petrol is now almost 20p more than it was when the weekly rise began at the end of November 2020.
And the motoring group warns motorists will start to see their vehicle running costs go even higher from September when filling stations are forced to switch to greener – but less efficient – E10 petrol.
No end in sight for rising fuel costs: The AA has confirmed that petrol prices have risen for 23 consecutive weeks, pushing the average for unleaded above 133p-a-litre this week
On Sunday, petrol had reached 133.34p-a-litre and remained above 133p going into this week, the AA’s fuel price report said.
It’s the highest average price of petrol seen since October 2013, and is 19.34p higher than in late November (114.0p on average).
Diesel has followed a similar trajectory, beginning its upward surge from 117.20p in the middle of November to 135.74p on Sunday – a surge of 18.54p-a-litre in the last 23 weeks.
AA fuel price spokesman, Luke Bosdet, said 32 weeks of rising fuel costs have been a ‘drain’ on the finances of drivers, families and businesses.
‘A family with two petrol cars would have spent around £230 on fuel in November had covid lockdowns not discouraged travel,’ he explained.
‘Now, the monthly cost of refuelling their vehicles is above £265.’
Asda is currently by far the cheapest location to fill up, with petrol and diesel almost 5p-a-litre less than the national average.
While Sainsbury’s almost matches Asda for unleaded, Tesco and Morrisons are 3p-a-litre dearer. Asda is also the cheapest of the big four supermarkets for diesel.
Asda is by far the cheapest location to fill up, with petrol and diesel almost 5p-a-litre less than the national average
Motorists can expect to see their vehicle running costs rise again from September
While prices are still some way off the record high cost of fuel in April 2012 (142.48p for petrol and 147.93p for diesel), the AA has warned motorists that they should expect to see their fuel bills rise again from September when greener E10 petrol is introduced at forecourts around the country.
ULEZ expansion and Clean Air Zones will be another drain on driver finances
Although the end to the summer motoring season often leads to lower pump prices as falling US demand hits commodity markets, for many UK drivers this will be the first taste of specific environmental measures leading to higher costs, the AA warns.
Inner-city access charges that target more polluting older vehicles are also beginning to bite, raising money for the local authorities implementing them.
Government figures released last month show that, in the first year of its Ultra Low Emissions Zone (ULEZ) access charges, the Greater London Authority increased its profit from congestion charging by more than £100 million.
In October, the ULEZ will be extended to a much bigger area of the London, with 300,000 residents’ cars facing the £12.50-a-day charge and another 100,000 vehicles from outside the zone likely to be impacted.
Bosdet said the extension of ULEZ on 25 October and arrival of other Clean Air Zones (CAZ) could be ‘devastating’ if you are a low-income car owner living or working in a ULEZ or CAZ where daily charges will price you off the road if you don’t have the funds to replace your car.
Under new Government rules, by law all retailers will need to sell E10 petrol with a higher bioethanol mix than E5 that’s been on sale for years.
While it will reduce vehicle emissions by 750,000 tonnes a year, drivers will see an increase in their fuel costs – and the Treasury can look forward to a boost to its fuel duty income.
In its impact assessment, the Government claimed: ‘Introducing E10 will add to fuel costs paid by motorists. Moving from E5 to E10 is estimated to reduce pump price petrol costs by 0.2 pence per litre. However, as the energy content of the fuel will also decrease, motorists will have to buy more litres of fuel. Overall fuel costs for petrol cars are therefore estimated to increase by 1.6% as a result of moving from E5 to E10.’
If the switch equates to a 1.6 per cent increase in UK petrol consumption, the Treasury may see income from fuel duty increase by £13million-a-month, or £156million-a-year.
Latest HMRC statistics show that in May, with car travel back to 90 per cent of pre-pandemic levels, UK petrol consumption was back to 1.312billion litres. In 2019, monthly petrol consumption averaged 1.404 billion litres.
The AA says this will likely help the Treasury claw back some of the lost income from CO2-based Vehicle Excise Duty now that more tax-free electric vehicles are being used on the road.
This week, the Government backed away from road pricing as an alternative to fuel duty, however, with the ban on new petrol and diesel vehicles less than nine years away, it has to find a way to claw back a £765-a-year loss in fuel duty once fossil fuel cars disappear from our roads.
Bosdet added: ‘For now, things are rosy for the Treasury: revived fuel duty income from more car travel, increased petrol consumption from E10, and 3p-per-litre extra in VAT from petrol rising from 114p to 133p-a-litre.’
What is E10 petrol and why is it being introduced?
The Department for Transport has confirmed that fuel retailers will be selling greener D10 petrol from September – though drivers of older cars are warned to avoid it
Unleaded currently sold in the UK contains up to five per cent bioethanol, hence the name E5. Bioethanol is produced solely from crops, such as sugar beet, low-grade grains and waste wood, and is deemed a renewable source.
From September, greener petrol with a 10 per cent bioethanol mix will become the new standard.
MPs say its introduction on UK roads will have eco credentials to the equivalent of taking 350,000 cars off the road, or all the passenger vehicles registered in North Yorkshire.
However, experts have for years warned owners of older cars – especially classic models – that E10 petrol could impair their vehicles.
Drivers of pre-2002 motors in particular have long been urged not to use the new petrol until they know it safe to do so – and that they may need to take additional measures to prevent E10 unleaded causing significant damage.
Is my car compatible with E10 fuel?
All cars produced from 2011 have been required to be able to run on E10 fuel.
You can find out if your car is safe to use it by visiting the online checker tool.
My car is compatible. How much will fuel bills increase?
Assessments of E10 petrol has already found that it might not only push pump prices higher but also be less efficient than E5.
Edmund King, president at the AA, highlighted the government’s impact assessment document that estimates that the introduction of E10 ‘will add to fuel costs paid by motorists’.
The study calculates that petrol would become around 0.2p-a-litre pricier due to the higher bioethanol mix, and also be less frugal.
‘Overall fuel costs for petrol cars are therefore estimated to increase by 1.6 per cent as a result of moving from E5 to E10,’ the report concluded.
The introduction of E10 fuel will cut UK carbon emissions from vehicles by 750,000 tonnes per year, it has been claimed. However, owners of vehicles that shouldn’t use it due to the higher bioethanol mix will have to fork out for more expensive Super Unleaded, which will continue to use a 5% ratio of bioethanol
My car is not compatible with E10 petrol. What damage could it cause?
Doubling the amount of bioethanol in fuel can cause a variety of issues in older vehicles, classic car insurer Hagerty tells us: ‘Because ethanol is hygroscopic, it absorbs water from the atmosphere. And that water, in turn, finds its way into your car.
‘This can lead to condensation in fuel tanks, fuel lines and carburettors and cause corrosion in brass, copper, lead, tin and zinc components.
‘As ethanol is also a solvent it can eat through rubber, plastic and fibreglass, so hoses and seals are likely to perish more quickly because of the higher concentration of ethanol in E10.’
Even Department for Transport tests have identified resulting damage to classic by E10 petrol.
Degradation to fuel hoses, seals and rubber components, blocked fuel filters, damaged fuel pumps, corroded carbs, blocked injectors and corrosion in fuel tanks have all been acknowledged in official documents.
Guy Lachlan of Classic Oils provided Hagerty with some advice to owners of older cars and classics: ‘You’ve either got to use fuel with no ethanol or change the materials that don’t like it.
‘If you are in any doubt about your rubber fuel lines, change them. Get rid of your fibreglass petrol tank and install an aluminium one.
‘The other thing ethanol really doesn’t like is solder. If you are running a soldered float in your carburettor, then think about carrying a spare – they’re generally quite easy to change.’
How can I avoid using E10 petrol?
Supplies of E5 petrol will be maintained at forecourts, but only in the form of super unleaded, which is far more expensive than conventional, lower-octane, petrol.
It is currently priced at 143.5p-a-litre compared to 133.3p for standard petrol.
To fill a 55-litre fuel tank, you’re looking at paying an extra £5.60 each time.
And the DfT has suggested that E5 fuel might only be available for five years – potentially removed from pumps in September 2026.
After this date, the regulation will be reviewed to decide whether E5 should be retained or if it will fall on owners to turn to specially-created fuel additives for their older machines.