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Winter of discontent looms as prices soar
Published:  28 August, 2009

The AA has described the govenment's plan to go ahead with this month's 2p fuel duty hike as "baffling" and "nonsensical", saying it has sympathy for retailers in the face of soaring prices.

Luke Bosdet, a spokesman for the organisation, said: "Fuel sales dropped in the first quarter of this year due to higher fuel prices, and this meant less revenue coming to the government.

What is the point of putting prices up for motorists when they simply cut back on how much fuel they buy? The government loses out - and during a recession it just doesn't make any sense."

Bosdet added that, sadly, it would be retailers who would suffer customer wrath due to soaring pump prices.

He added: "We have great sympathy for retailers because when fuel prices go up it is often the retailers that get it in the neck from drivers - rather than the government which deserves it."

The comments followed UKPIA's warning that the 2p increase plus other factors, such as the further 1ppl duty planned for next April, and VAT returning to 17.5% in January, could add 6.5ppl to the price of fuel, not taking into account any oil price rises.

Meanwhile uSwitch.com found petrol prices rose by 15.6% in the past few months, from 90.6ppl in February to 104.7ppl at the end of August.