The falling price of crude oil causes two supermarkets to slash their fuel prices to below £1 per litre for the first time since 2009
Darren Moss
11 December 2015

The price of petrol in the UK has fallen below £1 per litre for the first time in six years.

Supermarket Morrisons today announced it would be selling petrol at 99.9p per litre, as well as cutting diesel prices by 1p per litre. The company said its price cut would save the average driver around £17 per week when filling up, compared to the price hikes experienced in May 2011.

Other supermarkets are expected to follow Morrisons' lead this weekend. Asda has already said it will be running a weekend promotion, with petrol priced at 99.7p per litre until Sunday night.

Although Morrisons has said it wants to keep its petrol prices below £1 per litre for "as long as possible", the supermarket chain has warned that its prices are linked to the global price of oil, which has been steadily falling in recent weeks.

The price of a barrel of Brent Crude oil - which serves as a benchmark price for oil purchases worldwide - dipped to below $40 (about £26) per barrel earlier this week - its lowest price since 2009. Oil had been trading at as high as $110 (£72) last summer, but a slowdown in emerging markets has lead to oversupply.

While drivers will no doubt welcome the move, the AA has pointed out that drivers in the rest of Europe and Ireland are already used to lower prices, with petrol currently costing just £83.4p per litre in Spain. The price of petrol had already fallen to an average of £1.05 per litre at UK supermarkets in November.

The RAC, meanwhile, has predicted that lower fuel prices will become a "common sight" in the run-up to Christmas.

Despite the price fall, petrol and diesel prices still remain high. Data from the RAC Foundation shows that fuel prices have been rising since 2009, when petrol was at its cheapest at 86p per litre, to a high of £1.42 per litre in April 2012.

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Comments
3

11 December 2015
On negative side of things this puts a bit of a dent on march towards greater plug-in acceptance and benefits.

 

Hydrogen cars just went POP

11 December 2015
If take-up of plug-ins is susceptible to dents from falling oil prices in this way, that would be indicative to me that "people" are not as bothered about local air quality/health as many might have us believe. Anyway, a hybrid owner would still benefit from the reduced oil price. A pure electric owner should not be at all bothered by the falling price as the amount of their running cost will not have changed.

12 December 2015
It should be an interesting test for those who argued reducing fuel costs would add to UK gdp. There should be a benefit unless fuel savings are just absorbed and turned into company profits.

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