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RMI warns of upcoming petrol price increases

RMI Petrol - the association that represents two-thirds of Britain's 9,000 petrol forecourts - is warning that the cost of filling up could rise by 3 per cent by August Bank Holiday and by 8 per cent by early next year.

The rise towards the end of the month is being blamed on currency movements and world oil price increases.

But of greater concern is the cost of petrol and diesel in early 2011. Planned increases in fuel duty in October and January and a 2.5 per cent increase in VAT could push prices up as high as 125.9p per litre. The previous highest cost for a litre of unleaded was 121.6p per litre

RMI Petrol chairman Brian Madderson said: "The rebound in crude oil pricing is disappointing but not entirely unexpected. It will further increase pressure on independent retailers who are fighting for survival, especially in rural areas, due to the double hit of falling volumes and tighter margins.

"This crude oil increase will feed through the supply chain and could result in prices going up by as much as 4p a litre in the next three weeks."

"We also need to remember that the coalition Government did not cancel Labour's Budget commitment to raising fuel duty by 1p a litre from October 1 and a further 0.76p from January 1, with both having VAT added.

"Then we have the coalition's emergency Budget proposal to increase VAT to 20% from January 4, so the outlook remains extremely difficult for motorists and retailers alike. As I forecast earlier this summer, we could be seeing new record pump prices within six months.

"All these trends will add to inflationary pressures in our market and across the economy, threatening higher interest rates in the medium term."

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