High cost of fuel forcing drivers to cut trips

Most motorists are suffering because of soaring fuel prices, says a new report. But those living in the countryside are worst-hit of all.

Almost half of Britain's motorists have been forced to cut back on car journeys because of soaring fuel prices, a new report reveals.

Rural motorists are worst-hit, with almost one third of those living in the countryside saying they will have to cut down further on trips to family members if motoring costs increase again.

Other findings in the RAC Report on Motoring 2011 are that rural motorists are nearly twice as reliant on their cars when it comes to visiting family and friends compared with drivers in urban locations. This is backed by findings showing that for 30 per cent of rural drivers, the nearest bus stop or train station is too far away to be convenient, compared with just three per cent of urban dwellers facing the same problem.

The report says that the financial impact is set to worsen, leaving people who rely on their car feeling "isolated as they can no longer afford their social lives or carry out family commitments". Rising fuel prices are particularly alarming for the 60 per cent of rural motorists who rely on their cars to transport children to school and social activities, and the 39 per cent of urban motorists who do so.

"This year's Report on Motoring shows the tough choices being made by many motorists, with rural drivers hit the hardest as they have little alternative but to use their cars," said Adrian Tink, RAC motoring strategist. "People's ability to live their lives and do the most basic of tasks, such as visit family and take their children to after-school activities, is being threatened – and it looks like it's only going to get worse."

Added Mr Tink: "UK drivers want action from the Government. They already pay the highest duty and tax on fuel in Europe. At the very least, we are calling for fuel duty to be frozen and scheduled inflationary rises to be scrapped. In addition the Government should look again at the fair fuel stabiliser so that increased revenue from high oil prices can be passed back to drivers."

The report shows that nearly one in 10 motorists has already had to give up driving children to school or social activities, with 24 per cent expecting they will have to. Three per cent have given up trips involving family commitments, with 27 per cent fearing they will have to, while seven per cent have stopped driving to work and cut down on social trips and four per cent have cut car trips for food and "essentials".

The RAC Report says rural motorists now feel "backed into a corner", with 64 per cent saying it would be very difficult to adjust their lifestyles to being without a car compared with 36 per cent of urban motorists. Yet 65 per cent of drivers say they will have to "severely reduce" their car usage.

 

Cost of running a car jumps 20% in just one year fuelled by £300 rise in petrol

Drivers are paying at least 20 per cent more to run their cars than they were a year ago, a survey reveals.

Rises in insurance premiums and petrol prices account for the bulk of the increase.

The average running cost is now £3,090 – 21.1 per cent more than the cost on April 1, 2010.

This includes a 30.7 per cent average increase in insurance and a 5.4 per cent rise in servicing costs.

Fuel costs – based on driving 10,000 miles a year in a Ford Focus – also went up from £1,400 to £1,721 a year.

This 22.9 per cent increase comes as oil prices are forced up by unrest in the Middle East, fuel duty increases at home and the recent VAT hike to 20 per cent.

The survey by Sainsbury’s Finance of more than 2,000 adults also discovered that MOT test costs have risen 1.9 per cent, while motoring taxes have increased by an average of 5.1 per cent.

Ben Tyte, head of motor insurance at Sainsbury’s Finance, said: ‘The cost of motoring has soared in recent months as all costs, but particularly fuel prices and insurance premiums, continue to rise.

‘The cost of driving can be kept better in check by shopping around, particularly for fuel and car insurance.’

THE RISING BILLS

Item Now April 2010 Rise

Insurance £815 £623 30.7%

Fuel £1,721 £1,400 22.9%

Servicing £317 £301 5.4%

MOT £55 £54 1.9%

Tax £182 £173 5.1%

Total £3,090 £2,551 21.2%

Earlier in the year, research by the AA found that filling stations were ripping off motorists by failing to pass on the fall in wholesale costs to their customers.

Research found there was a 4.4 per cent dip in prices in Europe – to 121p a litre – at the start of the year.

In Britain, however, there was a 1.18 per cent increase to 129p.
Research: The study was based on driving 10,000 miles a year in a Ford Focus

Research: The study was based on driving 10,000 miles a year in a Ford Focus 63050for.jpg

And last week, The Federation Internationale de l’Automobile (FIA), which represents 35million drivers and includes the AA and RAC, wrote to the European Union complaining that the way prices are set is ‘far from transparent’.

It followed further rises in petrol prices as the cost of a barrel of crude oil rose above $125. But prices have not fallen as quickly as the price of oil has dropped.

AA spokesman Luke Bosdet said: ‘Motorists are going bust on us. No one is giving us any answers as to why petrol prices are so high. We need greater transparency so that everyone can see we are paying a fair price for fuel.’

A previous study by the AA also found that the average insurance policy soared by £210 last year, which hit young drivers the hardest.

Fully comprehensive premiums for 17 to 22-year-olds rose by more than 58 per cent during 2010 to £2,251 – often more expensive than the actual cost of their vehicle.

Third party, fire and theft policies, which are most commonly bought by young drivers, also rose by more than 70 per cent throughout the year, reaching £1,390.

A spokesman said: ‘This has led to the biggest annual premium increases we have seen since the AA Index began in 1994.’

 

Motoring groups demand petrol price investigation

 

An alliance of European motoring organisations has written to the European Union calling for an investigation into the price of fuel.

The call comes from the Federation Internationale de l'Automobile (FIA) in a letter to the European Union.

The group represents 35 million European drivers, including members of the RAC and AA in the UK.

The FIA said the way petrol prices are currently set was "far from transparent".

Record prices

A full tank of fuel for an average European car now costs around £10 more than it did a year ago.

The price of fuel in the UK reached record levels in April as the cost of Brent crude rose above $125 a barrel.

Although the price of crude has fallen $10 since then, motoring groups say the wholesale price of petrol has not fallen as fast.

The price of crude oil is only one factor effecting the petrol price.

Oil is traded in dollars, so the exchange rate against the dollar has a big impact on prices.

Taxes, transportation and refining costs also vary - impacting the cost of fuel at the pump.

But the FIA says the EU should investigate the way petrol prices are set for the European market.

Most European petrol prices are derived from the Rotterdam spot market where some cargoes of petrol and diesel are bought and sold.

But the FIA is not sure that this market works effectively.

"A platform with such a small volume is doubted to be a representative indicator for the vast European market," said Werner Krauss, chairman of the FIA Eurocouncil.

The organisation also wants the EU to look into the role of speculators who invest in the oil market.

Mr Krauss claimed the "resulting volatility" in petrol prices had a negative financial impact on consumers.

The complaint is backed by the UK motoring organisation the AA, which is calling for an independent regulator to oversee the petrol market.

"No one is giving us any answer as to why petrol prices are so high," said AA public affairs spokesman Luke Bosdet.

"We need greater transparency so everyone can see we are paying a fair price for fuel," he added.

Retailers have said that prices do go down when the cost of petrol has fallen. One way for sellers to balance the changing price of fuel is to buy in advance.

The UK's largest supermarket, Tesco, say they try to keep prices low and will sometimes buy fuel in advance to balance changes in price.

But in a statement the retailer said it was difficult to predict when to buy.

"As everybody knows, it's very difficult to predict movements in crude oil prices, which can go down as well as up. So it's wrong to say that buying in advance is necessarily an advantage," Tesco said in a statement.

Petrol prices threaten holiday getaway

Soaring pump prices are threatening to put a damper on the Easter getaway.

According to the latest figures petrol is now costing an average of 134.17 pence a litre compared to 119.90 this time last year. Meanwhile diesel has risen from 120.65 pence to 140.57 a litre.

The increase in petrol prices, for example means that the driver of a car with a 50 litre car, such as a Vauxhall Astra just over £67 to fill up, compared with £59.95 a year ago.

Even though the temperature is expected to approach 70F, the AA predicted that many motorists will be loathe to venture out to the seaside.

"I think this is what we will see this year," said Edmund King, the AA's president.

"People are cutting back on how far they will go. According to our latest poll, 49 per cent of people are now driving less."

The AA believes this could be bad news for seaside resorts, who normally would expect to cash in when the sun comes out.

"These increases have been like water torture, there has been a gradual drip, drip, drip of rising prices."

Huge queues outside garage as decimal point blunder sees Asda sell petrol for 12.9p a litre

* News spread quickly after pricing error was spotted
* A full tank of petrol cost motorists only £4
* Drivers turned up with jerry cans to cash in on the cut-price bonanza

Motorists were treated to fuel at the unbelievable price of 12.9 pence a litre thanks to an amazing blunder at a supermarket petrol station.

Dozens of drivers queued outside the Asda store in Rooley Lane, Bradford, desperate to make the most of the error, caused by the misplacement of a decimal point.

Some motorists made off with a full tank of fuel for only £4 before staff at the store realised what was happening and stepped in to end the bargain buying.

Motorists queuing outside Asda's store in Rooley Lane, Bradford, after the supermarket accidentally offered petrol for just 12.9p a litre

Queuing for a bargain: Motorists outside Asda's Rooley Lane store in Bradford after the supermarket accidentally offered petrol for just 12.9p a litre

 

The accidental cut in prices happened from 10.30pm until 12.20am early on Wednesday this week.

So many motorists were tipped off about the incredible bonanza that police noticed huge queues snaking away from the supermarket.

Several even brought jerry cans and other containers with them which they filled to the brim with the cut-price fuel.

Others stared in wonder at the cheap prices as they paid using the automated card payment 'fast lane' pumps. And because the kiosk was closed, it took nearly two hours for bosses to realise the error.

The inadvertent discount on the automatic, card-payment fast-lane pumps on the forecourt was caused by the misplacement of a decimal point

Spot the mistake? With the kiosk closed motorists filled up on four of the garage's automatic pumps for more than two hours before the error was spotted

Jonathan Dixon, 25, a self-employed network technician, was just one of the dozens of drivers who took advantage.

He said: 'We got a tip-off from a friend saying Asda had made a mistake.

'Unfortunately my car is diesel but a friend went down and phoned up saying it was actually that price. So they filled up their car - they got nearly 33 litres for £4.

'There were cars round the block, completely out of the Asda car park and actually starting to jam the road up outside, and this was at about 11.30pm.

'My friends just couldn't believe that the mistake had happened. We were wondering how long it was going to last - we saw the police drive by once or twice, and they were just looking at what the jam was.

'In the end, about an hour-and-a-half later, some people came across from the site, I guess they were the managers, and they said, "Look, there's something wrong, stop what you are doing," and they just pulled the emergency stop.'

Several motorists brought jerry cans and other containers with them, which they filled to the brim with the cut-price fuel

Queue at the pump: Several motorists brought jerry cans and other containers with them; others couldn't believe what they were seeing

An Asda spokesman admitted that human error was to blame with a decimal point being put in the wrong place as staff programmed the four automatic pumps to allow the filling station to operate after the cashiers' kiosk was closed.

It meant unleaded was sold at 12.9p per litre, rather than 129.9p for nearly two hours until the pumps were eventually shut down.

The spokesman said: 'We're well known for having the lowest prices in town, but clearly this was a mistake.'

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Soaring cost of fuel cuts traffic jams by TWENTY per cent

Congestion on Britain’s busiest roads has fallen by nearly 20 per cent over the last three-and-a-half years as motorists hit by spiralling fuel prices leave their cars at home.

New Department for Transport figures show significant reductions in delays on motorways and main trunk roads as well as a drop in the overall amount of traffic – and Ministers confirm it is linked to the recession.

Separate data shows that in some parts of the country, delays on a number of major roads are down by almost 50 per cent over the past year.

The Government statistics measure congestion on nearly 100 of the country’s main roads by recording the average vehicle delay for the slowest 10 per cent of the journey.
Congestion hit a high in July 2007, when the figure reached four minutes 19 seconds per ten miles, but in

January it was down to three minutes and 49 seconds, a drop of 17 per cent.
It marks the first reduction in traffic volume since the international oil
crisis crippled fuel supplies in 1979.

Roads Minister Mike Penning said: ‘The falls in traffic volume over the last two years are likely to be linked to the wider economic situation but we recognise that it’s a tough time for motorists as we tackle the country’s record budget deficit.’

A report by Trafficmaster, which supplies information about congestion to car satellite navigation systems via a network of speed sensors on major routes, said that the number of hold-ups last month on the M1 between Leicester and Sheffield had fallen 52 per cent compared with February 2010.

Graham Smith, the company’s data manager, said: ‘The simple explan¬ation is that there are now fewer vehicles on the roads.

There is considerably less commercial traffic and in some cases people are finding other ways to get to work.

‘People are also cutting down on leisure trips or driving to the shops. The cost of fuel is a major factor in people’s decisions about making journeys these days.’

Traffic volumes in city centres such as Leeds have also fallen and the numbers of motorists paying the congestion charge for driving in Central London fell by 500,000 between 2009 and last year, even though there was no rise in the charge.

Figures released by the Office for National Statistics revealed that petrol sales dipped by 4.1 per cent over the three months up to January compared with the same period a year earlier as petrol prices rocketed.

There was an even greater drop of 9.5 per cent in the three months up to December compared with the previous year.

The fall in sales came as the cost of a litre of unleaded petrol soared to an average of 133.17p – £6 a gallon – earlier this month, up from 128.3p in January, and garages reported that many people could afford only half or even a quarter of a tank at a time.

Experts predicted that the cut of 1p a litre announced in the Budget would do little to reverse the trend of declining car use.

RAC motoring strategist Adrian Tink said he was in no doubt that motorists were cutting down on driving as they felt the pinch.

‘We are seeing record numbers of people walking and biking. Evidence from the last couple of quarters is that the sale of petrol is dropping,’ he said.

‘A lot of people are combining journeys, making shorter ones and looking at alternatives like the train.’

He added that road improvements and extreme weather conditions were also factors.
 

Greedy garages defy the petrol price cut after Osborne\'s bid to help drivers

High prices: Some garages have refused to cut fuel prices by 1p, and some even put prices up

Drivers condemned greedy garages last night for failing to pass on the Chancellor's cut in fuel duty.

Despite the Budget cut of a penny per litre, pump prices stubbornly refused to move.

Some garages even cynically put up prices by a penny on Wednesday, the day of the Budget, so they could claim to have cut them when the reduction was enforced at 6pm.

Thousands more claimed they could not promise to cut prices at all because of the continuing rise in wholesale costs.

This is despite George Osborne's vow to watch oil companies and petrol stations 'like a hawk' to ensure there would be 'no funny business' on prices.

Mr Osborne announced a £2billion hand-out to drivers in his Budget statement.

As well as the immediate 1p cut, he cancelled next month's planned 5p rise and scrapped Labour's fuel duty 'escalator', which would keep pushing up prices.

Supermarkets Asda and Morrisons said they passed on the cut immediately, but growing evidence emerged yesterday of garage operators keeping prices unchanged for beleaguered drivers.

Before the Budget on Wednesday, petrol had risen to a record average of 133.53p a litre while diesel was at a high of 140.26p, making the cost of filling up a Ford Mondeo just short of £100.

Yesterday customers from all over the country called radio stations and posted messages on the internet telling of unchanged prices, or garages which had put a penny on a litre only to cut it again when the reduction came into effect.

Typical was Martin Ballard of Borehamwood, Hertfordshire, who said: 'I went past my local garage at 1.30pm on Wednesday and diesel was then 136.9.

'Just a bit later they'd put it up to 137.9. Sure enough when the duty cut took effect it was down again to 136.9. We've been scammed.'

Ian from Hereford wrote: 'My local garage put 2p on a litre on Monday, took a penny off last night and today put a penny back on.'

A BP garage in Mr Osborne's own Tatton constituency was still selling fuel at the same prices yesterday as Wednesday, at 134p for unleaded and 140p for diesel.

The Chancellor had said earlier: 'We will be watching like a hawk to make sure that motorists get the benefit of the Budget changes and make sure that there's no funny business.

'I can't control the world oil price, it may go up or down. What I can control are the taxes that are put on oil and are put on a litre of petrol.

Squeezing every drop: The OFT is investigating domestic oil and gas prices, but not forecourt costs

'I have cut that tax by 1p and crucially avoided the 5p increase that was coming in a few days time. For a family, that is 6p a litre less tax.'

Chief Secretary to the Treasury Danny Alexander insisted that the duty cut would 'feed through' to customers.

He said oil giants, which have been hit with a £2billion tax on windfall profits, would not be able to pass on higher charges to consumers because the price of oil is set globally.

Independent petrol retailers claimed they had not let the price drop because they would still be selling fuel bought before the duty cut for at least another week.

The Retail Motor Industry Independent Petrol Retailers Association, which represents two-thirds of the 8,800 forecourt sites across the UK, warned that prices may not come down at all.

'Wholesale costs have continued to rise this week with unleaded up by nearly 2p a litre and diesel up by 1p,' a spokesman said.

'Thus prices at the pump will continue to rise irrespective of the duty reduction.'
Motoring groups demanded that the oil giants be subject to a 'road fuel regulator' to prevent UK drivers being 'fleeced' by industry sharp practice and 'profiteering'.

AA spokesman Luke Bosdet said: 'At the moment the whole fuel process is shrouded in mystery. Unless there is real transparency on pricing in this country, the oil giants can pull a fast one and no one would be any the wiser.'

The Office for Fair Trading has launched an investigation into domestic oil and gas prices, but will not consider the cost of petrol on station forecourts.

Shadow chancellor Ed Balls said the fuel duty cut was 'paltry' and called on the Coalition to reverse the recent VAT hike which added 3p to a litre of fuel.

'I think most people will say a 1p cut is not very much when we are being hit so hard by our petrol prices,' he said.

A Treasury spokesman said: 'We are clear we have cut duty by 1p, cancelled the incoming 5p rise from the previous Government due next week and introduced a stabiliser.

'We shall be watching like hawks to ensure this is passed on.'

BP said: 'Out of 1,500 BP-branded sites, 350 are operated by BP and we set the prices at those, but the rest are dealerships and are responsible for their own pricing.

'Due to competition laws, we cannot set the prices at those independent sites. That is done by the individual operator of the sites.'

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