The cost of filling up is predicted to rise once again, after a cut in oil production was announced.
Opec+, a group of oil producing countries that includes Russia and Saudi Arabia, said that it would be reducing oil production by two million barrels per day in order to stabilise prices. Fleets are being warned to expect the cost of petrol at the pumps to increase, after three months of falling prices.
In response to the announcement in early October, the price of Brent crude oil went up by 2% to over $93 (£82) a barrel. It is the most significant cut in the production of oil by Opec + since the peak of the Covid pandemic in 2020. Its actions were not welcomed by the US and other countries, whose supplies of oil have been badly affected by the Russian invasion of Ukraine.
However, members of Opec+ defended the action, saying that it was responding to global uncertainty about the demand for oil and fears of a recession.
“Such a deep oil production cut will inevitably see oil prices rise, forcing up the wholesale cost of fuel,” Simon Williams, RAC fuel spokesman, said. “The question is when, and to what extent, retailers choose to pass these increased costs on at their forecourts.
“Despite three straight months of pump prices coming down, we believe that in many cases drivers are being charged more to fill up today than they should be based on average wholesale prices over the last few weeks.
“If we see pump prices go up within the next fortnight, we’ll know that retailers are sticking to their strategy of taking far more margin on every litre they sell than they have historically – much to the dismay of drivers up and down the country, said Mr Williams.
Higher oil prices were a major factor in the increase in consumer prices that hit countries around the world earlier this year, sparking huge inflation rate increases and raising political tensions.