The price of fuel at the pump increased for the second month in a row in August with both petrol and diesel rising by more than 2ppl, according to the latest RAC Fuel Watch report.
Unleaded petrol increased 2.26ppl from 115.25ppl at the beginning of the month to 117.51ppl by the end and diesel rose 2.28ppl from 116.09ppl to 118.37ppl.
The price of petrol began to go up quickly after Storm Harvey hit the US Gulf Coast on Friday 25 August disrupting oil refining facilities. This caused the wholesale price of unleaded to shoot up by 4ppl by 31 August.
Crude oil also rose by 4% from $50.86 to $52.79, averaging $51.44 over the month, and the exchange rate suffered, falling by 3% from $1.32 to $1.28 from the start to the end of August.
RAC fuel spokesman Simon Williams said: “Sadly, fuel prices went up for the second consecutive month in August, but the 2ppl increase is unfortunately just the tip of the iceberg as motorists are likely to see further forecourt rises in the next week as a result of the disruption to oil refiners in Texas.
“While the price of producing petrol tends to be primarily affected by the cost of crude oil, and the exchange rate as it’s traded in dollars, it is also affected by global market forces for the refined product itself and we often see the price move up and down according to supply and demand issues. This has been the case since Storm Harvey as petrol is now in shorter supply. It has also been compounded by a drop in the region’s crude oil production. There is, however, a glimmer of hope as the latest assessments from the US have revealed the damage to the oil infrastructure caused by Storm Harvey is less extensive than had been feared.
“Despite this, pump prices in the UK will no doubt rise in the coming days and we still expect to see the price of petrol overtake that of diesel, although the wholesale price of diesel is also starting to increase. This, together with an early month rise in the oil price, means the outlook for fuel prices in September is not good.
RAC Fuel Watch data for August also revealed that the average price of fuel sold by the UK’s four leading supermarkets increased by more than the national average, going up by 2.49ppl for unleaded to 114.63ppl and 2.64ppl to 115.17ppl for diesel.