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Petrol prices fall for second month... but drivers to be hit by 3p a litre hike in fuel duty in August

UK petrol prices have for the second month running fallen by more than 4p a litre Photo: Danny Lawson/PA Wire

UK petrol prices have for the second month running fallen by more than 4p a litre, the AA have said. It is a reduction not seen since the price collapse of late 2008.

But the driving group also warned fuel duty is due to increase again by 3p litre on August 1.

It is of course excellent news that a two-car family's petrol costs have fallen £9.83 in the past month and £18.49 since the record high in April, but could the price crash have happened more quickly, as it did in Europe?

"Pump price transparency, a key campaigning goal for the AA over the past seven years, could have ensured that the £4.5 million-a-day switch of consumer spending from pump to high street boosted other businesses and lowered inflation far sooner.

"However, drivers must brace themselves for another hike if the Treasury's threatened 3p litre duty increase goes ahead on 1 August."

– AA president Edmund King

June's AA Fuel Price Report shows that, since mid-May, average UK petrol prices have fallen 4.63p a litre, from 138.40 to 133.77.

This is on top of the 4.08p-a-litre fall the previous month and is the biggest monthly drop since the petrol price dived 5.4p a litre between mid-November and mid-December 2008.

Even so, the overall 8.71p-a-litre reduction in the pump price petrol since the 142.48p record on April 16 is still short of where it should be, the motoring group said.

But fuel duty is set to increase again by 3p litre in August Credit: Danny Lawson/PA Wire

Under government pressure to make pump prices transparent, the fuel industry will have to prove in the future that UK drivers are paying a fair price for fuel, the AA said.

In the past month, the average pump price of diesel has fallen 4.99p a litre, from 144.30p in mid May to 139.31 now.

But UK diesel costs at least 4p a litre more than in Europe.

  • Northern Ireland remains the most expensive region for petrol at 135.3p, charging on average 1.1p a litre more than the next most expensive area and 2.1p more than the cheapest region, Yorkshire and Humberside (133.2p).
  • The cost of diesel in the South East at 140.0p pips Northern Ireland (139.9) to become the highest in the UK. Once again, Yorkshire and Humberside is the cheapest at 138.5p a litre.