Brent Crude price has increased by US$3/barrel due to the new Middle East uncertainty following events in Egypt and this has resulted in price at the pump increasing by 1.00ppl.
However the PRA says the real culprit for the rise in fuel costs this time is sterling, which accounts for 3.00 pence per litre (ppl) of the overall 4.00ppl increase seen on forecourts and is currently seeing a three-year low against the dollar, with the exchange rate falling from US$1.58 to 1.48 in just four weeks from mid-June.
Brian Madderson, PRA chairman, commented: ‘The new Bank of England Governor, Mark Carney, shoulders some blame for recently indicating that UK interest rates will remain low, contrary to market expectations. This combined with the poor UK manufacturing data this week and the US promise to let Quantitative Easing taper off this year, provide good reason for operators to flee Sterling.
‘This is at least fully transparent if still unwelcome news for motorists, businesses and UK inflation as the economy struggles to rebound,’ he added.
