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Last Updated: Monday, 5 September 2005, 12:26 GMT 13:26 UK
UK petrol prices continue to rise
Petrol station in London
Petrol prices could rise above 1 a litre in some areas
UK petrol and diesel prices continued to rise in the wake of Hurricane Katrina, with the average cost of petrol now at 94.6 pence a litre.

The average cost of a litre of unleaded petrol rose by more than 2p over the weekend from 92.3p on Friday, according to figures from industry body Catalist.

Average diesel prices now stand at 97.3p - up from 95.8p - and are expected to top 1 in the coming weeks.

Prices rose sharply after Katrina shut oil rigs and refineries in the US.

Diesel shortage

I took my motorbike on a trip to Wales at the weekend and paid 105.9 ppl at one petrol station that wasn't even particularly remote!
Chris, Milton-Keynes

The price spike has been prompted by fears of supply shortages, with 80% of crude oil production in the Gulf of Mexico still out of action.

Of the eight refineries closed in Louisiana and Mississippi following Katrina, only one had managed to restart on Sunday.

Officials warned that two of the biggest refineries still out of action could remain closed for months because of extensive flooding damage.

Retailers such as BP and Shell have been considering how to alter their forecourt signs in anticipation of diesel prices rising above 1 a litre.

Ray Holloway, director of the Petrol Retailers Association (PRA), said diesel was almost certain to top the 1 mark.

"I regret to say that diesel is (going to go above 1 litre) and that is because we have a shortage of the product," he told the BBC.

Prices were expected to rise still further later in the year, he added.

"Diesel motorists will be complaining about that and perhaps asking the Chancellor about the tax position."

Price spike

Some motorists this morning will be looking at price signs saying a pound plus but I do stress that I think this is a spike
Ray Holloway, Petrol Retailers Association

Average petrol prices topped 90 pence a litre for the first time last month and have carried on rising.

However, the PRA insists that it is not "inevitable" that most customers will soon be paying more than 1 a litre for their petrol.

Mr Holloway said he expected prices to fall in the autumn, a time of the year where demand traditionally eases.

"Some motorists this morning will be looking at price signs saying a pound plus but I do stress that I think this is a spike and that prices will fall away further in September," he said.

However, he warned there was a danger of price rises in the run-up to Christmas as more oil was required for heating fuel stocks.

Easing the burden

Motoring groups have called on the government to cut fuel excise duty to ease the burden on consumers of higher petrol costs.

They argue duty levels should reflect the sharp rise in crude oil prices, which hit a record high of $70.85 last week.

"Current hikes are fuelling inflation and hitting those low-income and rural car dependent motorists hardest," said Edmund King, executive director of the RAC Foundation.

"The Chancellor could and should introduce a mechanism whereby fuel duty is reduced if world prices hit a certain level."

Motorists react to rising petrol prices

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