The 100-pound unleaded petrol tank is another milestone on the relentless upward path of fuel prices.
Keeps an eye on the price click in to three digits for the first time will breathe from anyone who fills the 55-liter tank in a family sedan.
But no matter how you count it, prices have already been kicking consumers in the stomach for weeks.
Fuel inflation has been staggering for the past 12 months, with lead-free 37% more expensive than this week a year ago, and diesel 38%.
Drivers who have no choice but to use their cars have no choice but to shop around and soak up the latest hit at the pumps. But even if you do not drive – and millions of Britons are not car owners – you will pay a price.
Given the fundamental role of motor fuel in the economy, there is simply no way to avoid the impact.
The Office for National Statistics estimates fuel prices accounted for 0.7% of April 9% overall inflation rate; a back-to-back calculation suggests that further increases mean petrol and diesel could make up 1% of the May tariff when the figures are released.
Almost everything we use and buy comes to us by road one way or the other, and as hauliers now estimate the annual fuel bill for a truck at £ 20,000, it is inevitable that some of these costs will be passed on.
There are few signs that prices are heading out, much less falling, in the coming weeks. Prices are determined by the wholesale market for crude oil – still around $ 120 per barrel. barrel – and more immediately refined gasoline and diesel.
These have been exacerbated by the invasion of Ukraine. Prices were high before Russian tanks rolled in, but the conflict has had an immediate and fundamental impact.
Russia is the world’s second largest oil producer, but sanctions and promises from the EU, Britain and other nations to boycott the country’s oil before the end of the year are expected to take 3 million barrels a day out of global markets.
Just as important for the current pump price, Russia is also an important source of refined diesel fuel. The war is mentioned by manufacturers as a factor driving the growing difference with lead-free prices.
And even if crude oil prices were to fall, retailers would still sell us the fuel already stored in their tanks by refineries and distributors. These record prices will pass through the pumps for some time.
Retailers say they have limited opportunity to reduce costs. They mention tight margins, and the need to make money to invest in new technologies that the government demands – including the charging network for electric vehicles, which is crucial in stopping the dependence on the internal combustion engine.
They also point out that the reduction in the 5p fuel tax, announced in March, cost the industry millions as they had already paid the tax on fuel in stock but could not pass it on to customers.
A tank on an average family car can now cost £ 100
It can not wash with drivers looking at prices that are already north of the 2 pound liter. Ministers have threatened to name retailers who do not lower prices, and the business secretary has referred the matter to the Danish Competition and Market Authority, but they and the industry know that it is not possible to control the price at the pump while customers buy.
What the government could do is cut further in the fuel tax or VAT rate of 20%, which together make up about 45% of the pump price and gives the Treasury an accident due to high prices.
As with domestic energy prices in the spring, we can enter the “something needs to be done” phase in this chapter of the cost-of-living crisis. There is no price cap on fuel to protect consumers, but at the moment there is no point in the Chancellor feeling the heat on the fuel.
The fuel tax is expected to raise £ 26 billion this year. The question for anyone who suggests that the number should be cut is where the revenue should come from instead.
