Belfast Telegraph

Wednesday 26 November 2014

Treasury boost from fuel sale surge

Government figures highlighted a surge in petrol and diesel buying last month
Government figures highlighted a surge in petrol and diesel buying last month

A surge in petrol and diesel buying last month helped swell Treasury coffers, according to Government figures highlighted by the AA.

Drivers bought 1.60 billion litres of petrol in June, contributing £929 million in fuel duty to the Treasury, the statistics showed.

This compared with 1.56 billion litres bought in May, resulting in £904 million in duty revenue.

Diesel sales were also up last month - rising from the May figure of just under 2.26 billion litres to just over 2.33 billion in June.

The AA said that throughout June, the UK's average price of petrol held at around 134.6p a litre. At the moment it is averaging 137.11p, following yet another surge in the wholesale price.

Although panic buying, resulting from the threat of a tanker driver's dispute, propelled UK petrol demand in April 2012 up to 1.68 billion litres, the last time normal UK petrol sales were above 1.60 billion litres was in November 2011 when sales reached just over 1.64 billion litres, generating £951 million in fuel duty.

In March, the coldest in 50 years and blighted by the third pump price spike in 12 months, petrol prices soared to 140.03p a litre and the volume sold crashed to a record low of 1.375 billion litres. Fuel duty receipts were slashed to £797 million.

The AA said that two huge 8p to 10p petrol price swings in March and October last year sank UK petrol demand to just under 1.48 billion litres and 1.536 billion litres respectively. The March spike raised the UK average price of petrol to the current all-time record of 142.48p a litre.

AA president Edmund King said: "Pump price volatility has wreaked havoc on petrol demand in the UK over the past 18 months. The uncertainty it has created has lost the Government large amounts of tax revenue.

"From the commodity markets to the forecourts, pumping up the cost passes down the chain until it hammers the consumer. Drivers have reacted by cutting back - up to 76% of AA members have cut back on car use, other spending to compensate, or both."

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