Why is the cost of petrol increasing?
Latest news reports have revealed that the price of petrol is to increase again, and perhaps we should wonder if maybe the Bank of England is to blame as it continues to try to stimulate the economy. It is expensive for us to buy as oil is priced in US dollars and the pound has lost approximately a tenth of its value against the US dollar since last April. Plus the price of oil did increase rapidly at the beginning of the year due to the unrest in the Middle East and the continuing problems in Iran.
As millions worry about this new increase Chancellor George Osborne says he will ‘take action’ on the petrol prices. He said "I completely understand the pressure on families, that's why we've taken action to make sure that petrol is 10p per litre cheaper than it would have been if we'd stuck with the tax rises of the last Labour government."
Will the next budget see another price increase?
Cathy Jamieson, Labour’s Shadow Treasury Minister said “millions of people who are already feeling the squeeze will be worried about how they can afford this latest rise in the price of petrol. George Osborne must use next month’s Budget to cancel his tax cut for millionaires this April and instead help people on middle and low incomes struggling with the rising cost of fuel and food. A temporary VAT cut would help to kick-start the economy and take 3p off the price of a litre of fuel right now. And a new lower 10p starting rate of tax, paid for by a mansion tax, would help 25 million people on middle and low incomes. The Chancellor must finally act in the Budget to support families feeling the squeeze and boost growth and jobs in our flatlining economy.”
Chris Green Sales Director at Motoring.co.uk said “it is time that the UK motorist stopped getting hammered in the pocket and not just on fuel, year after year we see the average motorist experiencing increases in fuel, car insurance and tax and motorists are simply an easy target. How can the motor industry thrive in such a climate when in the UK owning a car is becoming such an expense that daily motoring is now unenjoyable. Ministers need to take a long look at themselves and start to give the public a little back.”