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Last Updated: Tuesday, 6 September 2005, 17:51 GMT 18:51 UK
Petrol pumps see first 1 litre
Petrol price
The first prices over 1 a litre have appeared at some forecourts
Petrol stations in Wales have seen the price of a litre of unleaded petrol creep above 1 for the first time.

Diesel is expected to rise even more with garages blaming a lack of supplies in the wake of Hurricane Katrina.

An independent company with garages at Barry and Penarth was charging 103.9p. Some in rural Wales have also put their prices close to or above 1.

Hauliers and manufacturing companies have said their businesses are being damaged and are laying off staff.

The average price of normal unleaded petrol in Britain went up by more than two pence over the weekend, to 94.6 pence per litre.

The rise came after oil refineries in the US were knocked out by Hurricane Katrina.

Monty Smith, which has garages at at Barry and Penarth, near Cardiff, was one of the first to respond with prices topping 1 a litre.

We're paying over a pound a litre for it ourselves, so it had to go up
Andrew Smith, independent petrol retailer

Director Andrew Smith said the firm had no choice as supplies were costing the company over 1 per litre.

He said: "Because we buy ours on the spot market, as most people do now, as soon as it goes up we're the first to be affected. The supermarkets can take up to 12 days to have the same effect as we do.

"We still selling a fair bit, (but) not as much as we were hoping to. But unfortunately, we're paying over a pound a litre for it ourselves, so it had to go up."

Diesel prices

He said the firm expected to make 900 profit on a delivery of fuel on Friday, before the prices rise, which had cost 30,000.

He added: "We've been put in the position that we cannot compete at this moment in time. I think there's no future for the independent petrol retailer."

Alan Green, west Wales chairman of the road haulage association, said: "Over the past five years, fuel has gone up, up and up and it has never come down.

As the cost of fuel goes up, our costs go up, food goes up, everything goes up.

Petrol station in London
Petrol prices have been rising in the wake of Hurricane Katrina

"In Wales, fuel is the lifeline of the rural community. It isn't only our work that suffers."

He said his figures showed the average cost of running a car had gone about 34 per week over the past two years.

Ray Holloway, director of the Petrol Retailers Society, said: "The main oil price is something that has been increasing for some time.

"We have to accept we're now out of an era when our oil was able to come through to the pumps at around 80-85 per litre. Those day are behind us and were going to have to pay more for energy.

'Tax policy'

"I'm in the camp that the government should have realised a long time ago that we were headed into this new era for oil price and they should have revisited their tax policy on transport fuels after the warning they got in September 2000."

On Monday, Tregele service station, near Amlwch, Anglesey was charging 104p for a litre of unleaded, equivalent to 4.77 per gallon.

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

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




SEE ALSO:
South East fuel tops 1 a litre
05 Sep 05 |  England
Katrina stokes petrol price fears
01 Sep 05 |  Business


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