Queue for the pumps as prices near £2 a litre

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Drivers have started queuing for fuel after being hit by the steepest weekly hike in fuel prices in more than 18 years due to Russia’s invasion of Ukraine – with prices expected to keep rising.

Oil prices are rising at an alarming rate sparking warnings that petrol could soon hit £2 a litre – taking the cost of an average tank to more than £100 – an increase of around £17.

Unleaded hit an average record of £1.55 a litre yesterday, with industry sources saying it was likely to rise to £1.75 by next week as 5p is being added to the price every 24 hours in some areas. But prices at some forecourts are already pushing £1.80.

Motorists queued outside a Sainsbury’s petrol station in Cambridge today as they rushed to fill up cars and jerry cans before petrol prices increase even further. There were also long lines at the pumps at a Tesco in neighbouring Suffolk. On social media there were also reports of queues at supermarket pumps in Lancashire.

It came as Rishi Sunak was urged to put the City of London on a ‘semi-wartime setting’ amid fears the Ukraine conflict could spill further into Europe. The Centre for Economics and Business Research has predicted that GDP growth this year will be slashed from 4.2% to 1.9% in 2022 and down to zero in 2023.  

Amid fears energy bills could soon hit £4,000-a-month, the average price of a litre of petrol at UK forecourts rose from 149.2p on February 28 to 153.0p on Monday, according to the Department for Business, Energy and Industrial Strategy (BEIS).

Average diesel prices rose from 153.4p to 158.6p over the same period. The weekly increases of 3.8p for petrol and 5.2p for diesel are the largest in records dating back to June 2003.

They mean the cost of filling up a typical 55-litre family car has increased by more than £2 over the past week. Figures from data firm Experian Catalist based on a different methodology to the one used by BEIS suggest the average cost per litre of petrol on Monday was 156.4p, while diesel was 162.3p.

Oil prices have spiked due to concerns over the reliability of supplies amid the war in Ukraine.

The price per barrel of Brent crude – which is the most commonly used way of measuring the UK’s oil price – reached 139 US dollars on Monday, which was its highest level in 14 years 

There were long queues outside the Sainsbury’s petrol station as prices hit a record high due to the Ukraine crisis affecting oil prices.

Some drivers even took along extra containers to fill with petrol, with the price at pumps expected to go up again. UK petrol prices have hit an average of 155p a litre, according to the AA motoring group. 

Ministers are also discussing possible financial help for businesses hit by soaring energy bills. Energy traders took fright yesterday over US-led efforts to promote a Western boycott of Russian oil and gas to further squeeze the ability of Moscow to fund Putin’s war machine.

Oil prices also continued to rise, sparking warnings that petrol could push toward £2 a litre – taking the cost of an average tank to more than £100. Unleaded hit a record £1.55 a litre yesterday, with industry sources saying it was likely to rise to £1.75. 

Black cab drivers are not driving around to pick up passengers to save money because 5p is being added to the cost of a litre of fuel every day in Britain.

The price at the pumps could hit a wallet-hammering 175p next week as average petrol prices on UK forecourts exceeded 155p for the first time.

Global oil prices are at the highest level for 14 years today – spiking to $140 per barrel on some markets – as the West considers banning imports of Russian oil that gives the pariah state $100billion-a-month to help fund his military. 

The AA said today that for a family car with a typical 55-litre tank, filling up now costs nearly £17 extra than a year ago, going up from £68.60 to £85.59. 

Steve McNamara, general secretary of the Licensed Taxi Drivers Association, said ‘extortionate’ fuel prices are having a major impact on the drivers of the 10,000 diesel-powered black cabs on the capital’s roads.

He said: ‘If you’re running costs are up 20-25% it starts to bite. What we’re seeing is more cabs looking to park on ranks. They’re trying to avoid cruising around.’

Hauliers are warning they will be forced to increase charges to meet rising fuel bills, which will lead to a knock-on effect for consumers.

Rod McKenzie, managing director at trade body the Road Haulage Association, described the spike in the cost of diesel as ‘dramatic’.

He said: ‘If hauliers have to pay more for their fuel, they inevitably have to charge customers more. I suspect this will mean prices going up on everything that is delivered by a truck, which is frankly 97% of everything that we get in Britain.’

Typical profit margins in the industry are around just 3% so recent rises in fuel costs ‘have the potential to wipe out that profit’, Mr McKenzie said. 

James Spencer, MD of Portland Fuel, said: ‘This has been a layer cake of bad news for oil prices. On February 25, prices went up by 5p a litre. That was the single biggest rise on any day in history. And last week we had 5p every day’.

Asked where the price will be next Monday, he said: ‘There is no cap on this – even if we can get extra supplies on to the market, nothing will happen quickly. I’m afraid we are going to see prices in excess of £1.70 to £1.75 a litre’.

Figures from data firm Experian Catalist show the average cost of a litre of petrol at UK forecourts on Sunday was 155.62p. The price of diesel is also at a record high of 161.28p.

Campaigners including the AA are calling on Chancellor Rishi Sunak to cut VAT on fuel for households already being hammered by the cost of living crisis. Experts said without help, it will be a ‘disaster’ for the most disadvantaged families.

A year ago the price per litre of petrol and diesel was 124.32p and 127.25p respectively.

The cost of filling up a typical 55-litre family car with either fuel has become more than £17 more expensive over that period.

Oil prices have spiked due to concerns over the reliability of supplies amid the war in Ukraine.

The price per barrel of Brent crude – which is the most commonly used way of measuring the UK’s oil price – reached 139 US dollars on Monday, which is its highest level in 14 years.

RAC fuel spokesman Simon Williams said: ‘The average price of petrol across the UK has jumped by more than 4p in a week topping £1.55 for the first time ever, which means a gallon costs over £7 – something which many older drivers will be struggling to comprehend.

‘Diesel, however, has increased by 6.5p a litre to £1.61 or £7.30 a gallon.

‘These hikes are unprecedented and will sadly be hitting both homes and businesses hard.

‘It’s therefore vital the Chancellor acts quickly to limit the damage by cutting VAT to at least 15% which would save drivers 6.5p a litre and take the average price of unleaded back under £1.50.

‘Importantly, this could also limit the impact of inevitable fuel price rises in the coming days and weeks.’

VAT is currently charged at a rate of 20% on petrol and diesel.

AA spokesman Luke Bosdet said: ‘A year ago, with pump prices rising steadily after the pandemic slump, 125p a litre was bad news but 155p was unimaginable.’

He described the average petrol price rising above £7 a gallon as a ‘watershed moment’ which means ‘it’s time to ditch petrol and diesel, and switch to electric’ for drivers who can make the transition.

He added: ‘Although electricity is still susceptible to rising costs and market pressures, removing all those well-to-pump actors that can make a driver’s life a misery in a matter of weeks, will ensure a smoother ride with the cost of motoring – and a big saving initially.’

Washington is in ‘active talks’ with European allies about targeting Russia’s energy industry in the next round of sanctions, US Secretary of State Antony Blinken announced.

An oil import ban would be highly damaging to the Kremlin’s finances.

But it would almost certainly also send oil and gas prices spiralling across the West, pushing up energy bills at a time when millions of British households are already struggling with a cost-of-living crisis. 

Ukrainian President Volodymyr Zelensky has called for a global boycott of all Russian products – including oil.

‘If the invasion continues and Russia does not abandon its plans against Ukraine, then we need a new sanctions package,’ Mr Zelensky said in a video address on Monday, including ‘a boycott of Russian exports, in particular, the rejection of oil and oil products from Russia’.

He said: ‘The international community must act even more decisively.’

He also said that Russia should not receive goods and services from abroad ‘if (Russia) doesn’t want to abide by civilised rules’.

Mr Zelensky added: ‘It can be called an embargo, or it can be just morality.

‘Let the war feed them.

‘When someone loses his mind, you need to lose fear and forget about commerce.’

Oil prices surged by more than a fifth last week after Russia invaded Ukraine, finishing at $118 a barrel at close of trading on Friday and fuel prices hit record highs last week with petrol reaching 153.5p per litre, while diesel hit 157.47p. The RAC said petrol could hit 157p a litre if oil rose another 6 per cent to $125 a barrel. Some traders think it could even reach $200 a barrel. 

David Morrison, senior market analyst at Trade Nation, said: ‘I think we’re going to see a very sharp bump in oil prices, even without the European approval that the US says it will seek before taking action. That means more pain for all consumers.

‘For some this will be a price worth paying to support Ukraine – but it’s a disaster for those already struggling.’

Last night Government sources said it was too early to say whether Britain would support a total ban on Russian oil.

They pointed out that it makes up only a very small proportion of UK imports – it is estimated to be only around two per cent, with the UK getting most of its crude from Norway and the US. The UK has so far targeted major Russian banks and individuals with sanctions while avoiding the energy sector. But there have been indications for several days that the Government is rethinking its position.

On Friday, Foreign Secretary Liz Truss indicated at a Nato meeting that Britain will look to target Russia’s energy industry in future rounds of sanctions.

Analysts warned Europe was far more vulnerable to the negative effects of an oil import ban than the US.