Rishi Sunak MUST cut VAT on fuel to help drivers hit by record pump prices, RAC says

Chancellor Rishi Sunak has been urged to cut VAT on fuel as drivers continue to be hit by record pump prices.

The RAC issued the plea after data firm Experian Catalist said the average cost of a litre of petrol at UK forecourts reached a new high of 153.50p on Thursday, up from 152.20p on Wednesday.

The cost of diesel rose from 155.79p to a record 157.47p over the same period.

Oil prices have spiked due to concerns over the reliability of supplies since Russian troops invaded Ukraine last week.

Petrol and fuel prices have hit a record high for the past 14 years, figures reveal today

RAC reckons Mr Sunak should cut the VAT on fuel to keep the cost down for motorists

RAC fuel spokesman Simon Williams said: ‘This latest round of rises means the price of a litre of unleaded has now gone up by nearly 4p in just a week, adding £1.86 to the cost of filling a 55-litre family car.

‘Diesel has gone up by a similar amount over the same period, adding over £2 to the cost of filling up.

‘Once again, the high cost of oil is the main factor contributing to the prices drivers are paying

‘A barrel is now almost at the 120 US dollars mark, something that hasn’t happened since the spring of 2012.

Queues at the Tesco Petrol station in Newmarket, Suffolk on Wednesday morning as petrol prices soar to their highest

The price of petrol and diesel fuels are displayed on a board outside a petrol station at Emsworth Services near Portsmouth, in southern England on Wednesday

‘The RAC is now calling on the Treasury to look at an emergency, temporary cut in the VAT rate levied on fuel to ease some of the pain drivers are facing and to better protect them from upcoming rises.’

VAT is currently charged at a rate of 20% on petrol and diesel. 

Gas prices have also risen, with the Dutch April gas contract hitting a new record high of €185 per megawatt hour, the UK’s rising almost 40 per cent to 398p a therm in morning trading.

The increases threaten to worsen a cost-of-living crisis that could see millions of families crippled by gruelling £3,000-a-year energy bills, with rising energy prices set to pile further pressure on soaring inflation.

Russia continues to pump supplies into Europe, but the war in Ukraine – Europe’s biggest land conflict in decades – risks near-term disruption and is increasingly isolating the world’s second-largest producer of oil and gas from global energy markets. 

BP, Shell, ExxonMobil and the British Gas owner, Centrica, have all vowed to unwind billions of pounds worth of Russian ties as Moscow becomes an international pariah state. Britain is on course to spend £6.3million per day on imports of Russian gas, according to new analysis.