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Fuel prices hit new records ahead of spring statement

Chancellor Rishi Sunak is reportedly gearing up to announce a temporary cut in fuel duty of up to 5p per litre in his spring statement.

23 March 2022

Pump prices hit new record highs ahead of Chancellor Rishi Sunak’s potential announcement of a fuel duty cut in his spring statement.

Figures from data firm Experian Catalist show the average cost of a litre of petrol at UK forecourts on Tuesday was 167.3p, while diesel was 179.7p.

This is an increase of 18.0p per litre for petrol and 27.0p for diesel over the past month.

Oil prices surged immediately after Russia’s invasion of Ukraine.

This led to an initial increase in wholesale costs for fuel retailers, although prices dropped last week.

Fuel duty is currently levied at 57.95p per litre for petrol and diesel, with VAT at 20% charged on top of the total price.

Mr Sunak is reportedly gearing up to announce a temporary cut in fuel duty of up to 5p per litre in Wednesday’s spring statement.

Rishi Sunak
Chancellor of the Exchequer Rishi Sunak (Kirsty O’Connor/PA)

RAC fuel spokesman Simon Williams said: “The biggest retailers are once again letting drivers down by not charging lower prices while they can.

“Instead, they appear to be hedging their bets to protect themselves from future increased wholesale costs.

“This is why we fear a fuel duty cut by the Chancellor in the spring statement could be swallowed up by retailers to the detriment of hard-pressed drivers.

“A VAT cut would be a far more flexible and powerful way of easing the pain for drivers.”

Dr Doug Parr, policy director at Greenpeace UK, said: “The Chancellor should only cut fuel duty if he can make an equivalent cut to the costs of public transport, which offers more environmentally friendly support for those facing this cost-of-living crisis.”

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