Fuel cost cuts hit by falling pound

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Drivers aiming to keep down the cost of motoring by shopping around for car insurance and making other economies look set to continue battling high fuel costs - in spite of the price of oil falling to its lowest level in four months.

Light, sweet crude fell to just $104.46 (£59) a barrel on Tuesday - the lowest level since May this year, and way down on the $150 seen at the beginning of July.

However, motorists have been warned that the lower prices may not filter through to UK forecourts because of the low value of the pound against the dollar.

In mid-July average petrol prices hit 119.7p per litre for unleaded and 133.25p for diesel, but these have since fallen to 112.33p and 123.75p respectively, according to figures from the AA.

"The fall in prices that we have seen over the past few weeks have levelled off," an AA spokesman said. "The big fear is that, because the pound is weaker against the dollar, that will have an adverse effect.

The weak economy leading to a weaker pound (means) that we are not getting as much fuel for our pound."

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