Brown urged to freeze fuel duty

9:42am Saturday 11th October 2008

Petrol retailers have called for a freeze on fuel duty to help reduce forecourt prices even further.

The cost of petrol is 9% less than three months ago as oil prices plummeted to their lowest level for a year, according to the AA.

This offers consumers a modicum of comfort during the turbulent financial situation, with a 50-litre refill now £5.33 cheaper than when unleaded reached a record high of 119.7p on July 17.

But prices are still over 11p a litre more than this time last year, an equivalent increase of £5.70 for a 50-litre refill.

Ray Holloway, director of the Petrol Retailers Association (PRA), said: "Gordon Brown always has the ability to reduce fuel prices through a fuel tax reduction, but avoids it.

"The price of fuel at the pump is influenced by a range of factors beyond just the price of a barrel of oil but despite this, forecourt retailers have still managed to reduce the cost of fuel to the motorist at the expense of their own profit margin during recent weeks.

"Prices for crude oil and forecourt fuel are obviously linked but they do not move in tandem. Therefore they do not automatically move up or down at the same time."

A PRA spokesman added that oil price changes typically take between six to eight weeks to filter down to forecourts.

Supermarket giant Tesco lowered unleaded and diesel by 3p across its 430 UK forecourts on Friday. It follows a penny cut by rival Asda at the start of this week, and price drops made by a host of retailers last month.

AA spokesman Paul Watters said: "The 3p drop in the price of petrol is very welcome, particularly with another supermarket taking the lead in price reductions. This should cut the cost of filling a tank by £1.50, which will help to offset grocery and domestic energy inflation."

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