Petrol prices rise 26 per cent in year

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Petrol prices are set to hit their highest level since September 2008 and in the run-up to Christmas will have risen 26 per cent since the start of this year.

Petrol is expected to pass 110p a litre and speculators, who are stockpiling oil, have been blamed for the price surge.

Rises in tax and the plunging value of the pound have also contributed to the increased prices.

On Monday the price of a barrel of oil was just below 80 US dollars, whereas the last time petrol hit such a high a barrel cost 100 US dollars.

Meanwhile, in the New Year motorists will be hit by a planned 2.5 per cent increase in VAT by the Government.

Rail travellers will also be hit with New Year fare increases and unions have predicted that most day-returns and long distance tickets will rise in price by around 15 per cent.

Economists fear that rising travel costs could have an impact on the retail sector. Families who are forced to spend money on travel may be reluctant to part with their cash over the festive period, buying fewer gifts and spending less on their Christmas celebrations.

Copyright © Press Association 2009

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