TIMES UP!: Coming soon, the £100 fill-up as the cost of petrol soars again

By SIMON DUKE

Last updated at 7:30 AM on 7th November 2011

After a brief respite, fuel costs will start rising again next year as demand from the fast-growing economies of Asia triggers a boom in oil markets.
Motorists were warned last night to prepare for four years of soaring costs at the petrol pumps, with the price of a full tank expected to top £100.
This will push the price of a litre of unleaded petrol from an average of 134.8p now to 154p by the end of 2015, according to forecasters at the Ernst & Young ITEM Club.

Filling up: A tank of petrol is set to cost over £100 within a few years

The cost of filling the 70-litre tank of a Ford Mondeo will spiral from £94.36 to £107.80.
ITEM Club economist Neil Blake said: ‘By 2013 prices at the pumps will be eating into household finances once again. Demand from the emerging markets will maintain the pressure on inflation, as will the increase in fuel duty on the home front.’

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There will be a measure of relief for car owners in the coming months as rampant energy inflation recedes, according to Mr Blake.

But they are facing a double hit next year as the Government slaps two duty increases on petrol.

Chancellor George Osborne will introduce a deferred annual increase of 3p a litre in January and is likely to follow that up with another rise in August.

Pumps: The rising cost of petrol is driven by global oil prices and tax increases

Last night Mr Osborne was urged to rethink his planned hit on struggling motorists, who are already facing steep rises in their insurance premiums.

AA spokesman Andrew Howard said: ‘Our primary concern is whether the Government chooses to defer the January duty hike. They have done that in the past when prices have been high and we hope they do it again.’

A steep rise in energy and petrol prices will intensify the squeeze on households at a time when average pay rises are lagging behind inflation.

Although the surge in food prices will continue to decline next year, it won’t cushion the blow for long, according to the ITEM Club.

Mr Blake said: ‘The good news is that food, oil and petrol prices will all start to come down next year, providing some much-needed relief for the hard-pressed consumer.

‘However, the five-year outlook is far less rosy as inflationary pressures begin to bite once again and this will be compounded by weak wage growth.’

With little prospect for a fall in unemployment levels, workers will have ‘limited bargaining power’ during annual wage negotiations.

Mr Blake said: ‘Consumers need to enjoy next year’s respite as much as they can.’