In case you were wondering: no, it’s not just you, fuel prices have actually seen a recent and dramatic increase. The RAC reported that in May 2018, fuel prices role by 6p per litre, which is the largest monthly increase that they have ever reported in 18 years. It is more important now than ever to be watchful about how much you are spending on fuel. So what is the best way to monitor this?
Factors Involved In Determining Fuel Prices
There are a myriad of different variables that contribute to the current fuel prices. The amount you spend on your petrol or diesel can vary based on:
- Your region (there are more expensive areas, such as Central London)
- Where you purchase your fuel (different petrol stations have different prices, and there is no national pricing for fuel, unlike with groceries)
- Whether you live remotely (if your area only has a few petrol stations, your options are restricted to the ones within reasonable distance, which may not have reasonable prices)
- Whether you live near a motorway (petrol stations located on or near motorway junctions tend to charge more)
- How much competition there is for petrol stations (in cities or large towns with lots of petrol stations around, prices tend to be lower to remain competitive. In areas where there are only a handful of nearby petrol stations, they can afford to keep prices high)
That means there will be some fluctuations in price based on all the factors above. According to the RAC, this trend has been going on for quite some time, and since the end of April 2018, fuel prices have been rising almost on a daily basis.
A lot of organisations have spoken out against this steep increase in fuel costs, or taken action to combat it. The RAC have stated that the current costs of fuel are too high for “no good reason” and cannot be justified. In response to this, fuel retailers have cited that wholesale prices and the volatility of the US dollar have necessitated this move, and independent fuel retailers are having to bow to pressure.
Brian Madderson, representing the Petrol Retailers Association, stated that: “We are in the middle of one of the most volatile periods of wholesale price movements we have seen for some time.” The PRA chairman explained that retailers will aim to cut down the prices if they are able to. “[We are] not going to price at an insult level.” Madderson also attributes climbing prices to the fluctuation of the dollar against sterling, reduced volume of petrol and diesel sales (as hybrid and electric cars become more popular), and the fact that retailers are required to add biofuels to diesel and petrol.
Supermarket chain and major fuel retailer, Asda, were the first to cut down their prices of fuel on the 13th June 2018. Roger Burnley, Asda’s chief executive, said: “We know that the cost of living is centre of mind for our customers and we will always do what we can to reduce that burden.”
A spokesperson for the RAC commended Asda’s decision – Rod Dennis stated: “At last retailers have done the right thing and started to cut prices at the pumps. From our data, we could see no justification for them holding on to savings that they have been benefiting from for three weeks. With petrol prices raising at their fastest rate in 18 years last month, millions of households and businesses will have been feeling the effect of having to spend more on what is an essential purchase for many. Today’s cuts should bring welcome relief.”
Track Your Fuel Spending To Save More
Despite Asda lessening the impact of rising prices with their decision to establish a price cap (no more than £1.25 per litre for unleaded petrol, or £1.28 per litre for diesel), many people will still end up spending too much on fuel. Luckily, there is another way to help you save.
Fuel cards are one great way for both businesses and private motorists to track their fuel spending and save money in the process. Not only do fuel cards greatly reduce your fuel expenses, but they also make the process of buying fuel simpler and more secure. If you own a business with a fleet of vehicles, you can monitor the spending and driving patterns of your drivers, and identify areas of improvement.
In today’s economic climate of inflation, and with fuel prices at record highs, it is absolutely vital that you are conscious about how much you are spending on fuel. Whether you are a large company with a large fleet of vehicles, a small company with a more modest fleet of vehicles, or simply a private motorist who is worried about increased fuel spending, there are many different fuel card schemes available to aid in keeping track of your fuel expenditures and cutting them down.
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