Tumble in petrol prices ‘carries warning’

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PETROL PUMP prices in Yorkshire fell by 6.5p last month as the cost of filling up on fuel across the nation witnessed one of the biggest falls for 25 years.

Between mid-November and mid-December the region’s petrol prices dropped to 116.2p – down from 122.7p the previous month. Diesel costs during the same period were 121.9p per litre, a decrease of 121.9p.

Petrol prices have plunged this year

Petrol prices have plunged this year

Figures from the AA show that the national average for the cost of one litre of petrol is now 116.32p per litre. Only an October to November fall of 11.5p per litre in 2008 and a dip of 7.9p in the summer of 2006 have been greater than this month’s decline.

And in further good news for motorists, prices are set to fall even further following a 2p-per-litre petrol reduction by the UK’s four biggest supermarkets, which took effect on Wednesday.

AA president Edmund King said: “A 6.6p-a-litre drop in the price of petrol releases a potential £3m per day switch of consumer spending from fuel forecourts to other business.

“It will also lower the cost of transporting goods, hopefully also to be passed on to customers.”

Average diesel prices across the UK have fallen by 5.27p in just four weeks.

A regional breakdown reveals that the south west of England currently offers the cheapest petrol at an average of 116.1p per litre, while East Anglia is the most expensive place to fill up a tank, charging an average of 117.1p.

The cheapest diesel can be found in Northern Ireland, where the cost of a litre is 121.8p, while Scotland charges the most at 122.27p for the same amount of fuel.

Reacting to this week’s news that the fall in world oil prices had prompted Britain’s ‘big four’ supermarkets – Asda, Morrisons, Tesco and Sainsbury’s – to slash the cost of petrol by 2p and diesel by 1p, the RAC suggested the new year could see petrol costs slump to below £1.

Fuel spokesman Simon Williams said: “What’s currently happening at the pumps with falling fuel prices is something many motorists will not remember seeing before.

“Talk of prices going up like a rocket and falling like a feather could not be further from the truth as retailers have been quick to pass on savings at the forecourt since we forecast on December 6 that prices were due to come down by 7p a litre for petrol and 6p for diesel.”

But the AA branded the possibility “remote”. Drawing on lessons of the financial crash of 2008, Mr King and urged caution in celebrations.

He said: “A white Christmas might be a better bet (than a fall below £1) at the moment.

“The parallels with the crash carry a warning from the ghost of Christmas past.

“In 2009, a new year brought a new assessment of the market and pump prices started to rise again on January 5.”