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Fuel prices continue falling as another 2p a litre slashed

Fuel prices are set to continue their downward trend, as the 'Big Four' supermarkets slash the cost of both petrol and diesel by up to 2p a litre.

Tesco will cut prices by 2p from this afternoon, while the same drop by Asda - the firm's 14th cut since September - will take effect tomorrow morning.

Tesco will cut prices from this afternoon, with Asda following suit in the morning Credit: PA

It means drivers filling up at Asda's pumps will pay no more than 105.7p per litre for petrol and 112.7p for diesel.

Morrisons and Sainsbury's have also announced price cuts.

The RAC predicts the price of petrol could drop below the £1 per litre level over the coming months - though the AA is more sceptical, and says rural areas in particular are being left behind.

Read: Boost for drivers as petrol set to drop below £1 a litre

  1. Richard Edgar

Motor fuels and tuition fees help curb inflation

There's been a surprisingly sharp drop in inflation this morning.

Prices rose by 2.2 per cent in October, down from 2.7 per cent the month before and well below economists' expectations.

A drop in petrol prices was one of the factors in the unexpectedly large inflation drop last month. Credit: PA

The main reasons were a sharp fall in transport costs, mainly motor fuels (for example a drop of 4.9p in petrol in October), and tuition fees.

The latter of these is a mathematical quirk: education costs rose 8 per cent but this was half the rate they were rising a year ago so the comparison contributes to a lower overall inflation figure.

Prices have been rising ahead of wages for years now. It's likely that that trend will be reversed some time next year but today's easing of inflation may bring the end of the squeeze on incomes a little closer.


Drivers 'spend more on fuel' than this time last year

Around 42% of motorists surveyed shop around for the best petrol and diesel prices. Credit: Lewis Whyld/PA Wire/Press Association Images

Drivers are spending an average of £14.64 more a month on fuel than a year ago, according to a survey.

As a result ,as many as 73% have taken positive steps to improve the fuel efficiency of their vehicles, the poll by Sainsbury's Bank Car Insurance found.

A total of 42% of drivers are shopping around for petrol and diesel, while 39% are driving less, 29% are driving more slowly and 26% are ensuring their tyres are properly inflated.

In addition, 19% have cut down on excess weight in their car by removing any heavy items from the boot before setting off and 17% have made efforts not to leave the engine running when stationary.

The economy measures also include 3% who have started car-sharing with friends, family and colleagues to go to work, while 2% have removed bike and roof racks from their cars.

AA petrol price warning to holiday motorists

Wholesale petrol costs across Europe have soared Credit: PA

Petrol pump prices could soar by 5p a litre, burning a hole in the pockets of holiday motorists, the AA has warned.

A surge in the wholesale cost of petrol across Europe has already led to a rise in UK petrol and diesel prices, with more misery possibly to come, the AA said.

On average, UK petrol prices have risen from 134.61p a litre in mid-June to 135.78p now, while diesel has gone up from 139.16p a month ago to 140.24p now.

The AA said: "A $100-a-tonne increase in the cost of petrol across north west Europe, combined with a weaker pound, heralds a potential 5p increase in pump petrol costs."

It added that should petrol go up 5p a litre then a family from Hounslow in west London, for example, heading off on holiday in a typical family car to Cornwall will pay £2.90 more for the return trip than it would have done in June.

Petrol pump prices edge higher

The cost of filling up at the pumps has edged up over the last month, with diesel drivers getting a worse deal than those using petrol, according to figures from the AA.

Petrol prices have been edging up over the last month. Credit: PA

The average price of petrol in the UK has risen from 133.35p a litre in mid-May to 134.61p in mid-June, while diesel has gone up from 138.17p a litre to 139.16p.

Northern Ireland has the most expensive petrol, at an average of 135.8p a litre, with London having the cheapest, at 134.61p.

Northern Ireland also has the dearest diesel (139.8p a litre) with London and south west England having the least expensive (139.1p).

The AA said the slight rise in average petrol prices nationally represented "something of a lull" after the 8-10p swings in prices over the last 12 months.

Petrol sales suffer 'huge drop'

Petrol sales have plummeted in the last five years, the AA have said.

In 2007, forecourts sold 22.87 billion litres of petrol but the annual figure had slid to 17.42 billion litres by 2012, Government statistics have highlighted.

Petrol sales have dropped in the last five years, the AA have said. Credit: PA

Diesel sales, though, have risen slightly over the last five years, going up from 14.80 billion litres in 2007 to 16.73 billion litres in 2012.

Looking at the most recent years, the figures showed that the 2012 petrol total of 17.42 billion litres compared with 18.27 billion litres in 2011.

Diesel sales rose from 16.24 billion litres in 2011 to the 2012 figure of 16.73 billion.

Taking petrol and diesel sales together, fuel stations sold 37.67 billion litres of fuel in 2007 but only 34.16 billion litres in 2012.

The AA said that the decrease was equivalent to 35 days of fuel sales being lost since the start of the credit crunch.

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