Luke Bosdet: Tank battle as motorists count rocketing cost of petrol

Unfortunately, the cost of fuel, particularly petrol, will get worse before it gets better. Wednesday's UK average petrol price went up to 116.51p a litre and a recent leap in the wholesale price could add a further 3p to 4p a litre. The Treasury is scheduled to add another approximately 3p a litre in fuel duty with VAT on April 1 and, the same day, the ending of a subsidy on biofuel production for cars will add another 1p a litre. Shortly after Easter, petrol could cost 124p a litre.

It all looks very gloomy and there are few signs of improvement. The pound has strengthened slightly against the dollar – the currency in which oil and fuel is traded on global markets. However, wholesale petrol prices are still $100 per tonne higher than they were in early February when petrol prices hit a plateau of 112p a litre.

Yorkshire is slightly better off than other parts of the country.

Its petrol and diesel is on average the cheapest in the country: 115p a litre for petrol and 115.9 for diesel. That makes typical pump prices about 1p a litre lower than the UK average and nearly 2p less than the most expensive parts of the UK.

So, where is this all going? In July 2008, when petrol and diesel prices soared to a record high, demand began to collapse, particularly in the US. Petrol prices in this country plunged from 119.7p to 85.99p by January 2009. Diesel dropped from 113.25 to 98.06.

I don't think we will see such a dramatic change, but drivers will cut back on fuel. That is bad for retailers who often operate on very low margins and rely on selling other items to keep their business going. If drivers visit less often for fuel, there is less opportunity to sell milk, sweets, groceries and other goods.

In Scotland and the West Country, volunteer drivers have found it more and more difficult to afford to transport the vulnerable to hospital appointments on the mileage allowance they get. This has left some NHS trusts in Scotland having to pay four times more to get out-patients to appointments by taxi than it would have cost with a volunteer driver. This echoes the more widespread problem in 2008, when volunteer drivers went "on strike" in Wales and others through the Midlands and Eastern England threatened to give up.

And then there are families, businesses, people on fixed incomes, youngsters who can only afford to live at home but have to drive a distance to their first jobs and other groups of people who rely on their car to go about their daily lives. Many, we hope, will look at ways to drive more efficiently: combining trips, car-sharing and using the smaller family car for errands, for example. Others will try to absorb the extra cost by reducing other spending: this could undermine profits in the high street, restaurants, cinemas and other leisure facilities. Over recent months, the AA has tried to impress on the Treasury the impact of rising fuel duty.

The Budget on Wednesday will tell whether or not they see the need to freeze fuel duty. In the

last Pre-Budget Report, the Treasury admitted that high fuel prices were expected to reduce fuel duty income by 200m this financial year.

All in all, it could be a tough start to the summer for everyone and fuel prices could become an election issue. How the Parliamentary candidates deal with the question on the doorstep could be interesting.

Luke Bosdet is a public affairs spokesman for the AA