Duty cut of 5p swallowed up
The price of a litre of diesel hit an average of 178.4p across the UK on Monday, a new record, government data shows.
The previous highest price – 177.5p – was seen two days before the Chancellor announced on 23 March that he was cutting fuel duty by 5p a litre on both petrol and diesel.
The fuel duty rate is now 52.95p.
Petrol prices have nearly returned to the level seen before the duty cut.
The average cost of the fuel was 163.7p per litre on Monday, compared with 165.4p on 21 March.
The current price of a barrel of Brent crude oil is about $109, though that is less than the 12-month high of $137.72 which it reached on 8 March 2022. The record high price of Brent crude was seen in July 2008 when a barrel cost $143.63.
It now costs drivers of an average diesel car just over £98 to fill the 55-litre tank. A similar-sized petrol car costs just over £90.
More information on fuel prices can be found in the RAC Foundation weekly fuel fact sheet.
Steve Gooding, director of the RAC Foundation, said:
“As we feared, it didn’t take long for the 5p reprieve to be swallowed up by global events which are driving pump prices back towards record levels.
“The Chancellor can’t be blamed for the soaring cost of oil but he could and should go further in cutting the rate of duty.
“Whilst all the attention is on the price of a barrel of Brent crude, the Chancellor continues to quietly take in taxation only just less than 50% of everything that drivers pay on the forecourt.
“There has been a lot of criticism of the windfall profits being made by companies like BP and Shell, but let’s not forget that record oil prices are also bringing in extra for the Treasury in the form of VAT which is levied not just on the product price of petrol and diesel, but also the duty element.”
VAT is charged at a rate of 20% of the combined product price and duty.
Philip Gomm – Head of External Communications – RAC Foundation
07711 776448 | [email protected]
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