Petrol prices have risen by 0.02p a litre since the 2011 budget, while more families are using credit to pay for their fuel but are not paying it off in full
Rocketing global oil prices are reversing the 1p fuel duty cut announced by George Osborne less than two weeks ago in his 2011 budget.
The RAC says the latest petrol price figures indicate the average price of a litre is now 133.55p, 0.02p higher than the average price on March 23 before the duty cut was announced.
RAC motoring strategist Adrian Tink said: "The volatile oil market has meant that drivers have seen very little benefit from the duty cut. Prices are continuing to spiral upwards with no end in sight."
When Osborne announced the cut in fuel duty, as well as the cancellation of the the fuel duty escalator (when the oil price is high), Osborne said the price of petrol had become a "huge burden" on households and that his initiatives would help "Britain's hard-pressed families".
But Tink said: "The chancellor made a great deal about the fair fuel stabiliser, but it's only stabilising government revenue ? motorists are still going to be hit by the rising cost of fuel. To add to the pain, the delayed inflationary increase of 3.02p is due to come in on 1 January. Who knows what the price of fuel will be at this point?"
The news on petrol prices comes on the back of research from Equifax,which shows more than two-thirds of consumers are using credit cards to pay for fuel, but almost a third are paying off less than 25% of their balance at the end of each month.
Equifax spokesman Neil Munroe said: "What is worrying is that more than 10% of people are only paying off the minimum on their credit card each month. And a further 18% are paying off less than 25% of their balance. It means they are paying a lot more for their fuel than just the �1.36 or so per litre ? and more for diesel."
With one in five of the 2,380 people surveyed saying they believe it will take them more than a year to pay off their credit card debt in full, the interest accrued from buying petrol with plastic could be considerable.
Munroe added: "We believe this highlights just how important it is to keep on top of credit commitments overall, especially with the growing threat of a Bank of England interest rate rise in the coming months."
Source: http://www.guardian.co.uk/money/2011/apr/05/rising-petrol-prices-fuel-duty-cut
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