Fuel prices in the UK surge to 18-month high

Energy - Mohit Shah - Jan 05,2017

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fuel prices in the uk surge to 18 month high

 

The price of petrol and diesel in the United Kingdom has risen to its highest mark since July 2015; these results are obtained right after the OPEC production slash.

According to the RAC, the average cost of unleaded petrol shot to 117.23p at the end of the month; whereas, diesel was recorded at 119.63p.

The OPEC production cut has significantly worked in the U.K. wholesale price surge for both the fuels.

The day the cartel declared a cut of 1.2 million barrels a day, Brent crude soared by 10% on 30th November.

The fuel prices currently are almost double to what it was recorded exactly a year ago. In January 2016, the price of oil was noted to be $27.88; this month the price has reached more than $55, which is surely a delightful news for the oil industry.

In the United Kingdom, the oil prices have been further boosted due to the tumbling value of the sterling after the Brexit vote.

In the next two weeks, RAC expects the price of unleaded petrol to further enhance to 118p, along with the price of diesel rising to 121p per litre.

The growth in the oil prices will now be determined primarily through Russia’s promise focused on production cut from January. It agreed to cut 600,000 barrels a day which will surely bring a change in the oil prices.

Simon Williams, RAC fuel spokesperson said, "Everything now depends on the strength of the deal and each country sticking to the agreed production levels.” He also added that, Russia will be regarded as a distinct interest “as it is currently producing at near record levels."

The oil prices will also be hampered in the upcoming months, due to the heavy political turbulence highlighting President Donald Trump’s policies along with the effects of Brexit negotiations which are set to initiate in March.