Login Register
Logout

Petrol prices set to rise after oil giants agree a freeze on output

You won't see petrol prices below £1 per litre soon as motoring groups predict the end of cheap petrol is 'just weeks away'

Cheap petrol prices could be coming to an end in weeks

If you need to fill up on your fuel, you should do it soon because cheap petrol is expected to come to an end after Saudi Arabia and Russia held crisis talks over oil production levels.

The two nations met behind closed doors and agreed to put a freeze on output, keeping levels the same as they were in January in order to stop prices plummeting further.

The surplus of worldwide oil has seen the cost of a barrel of oil plummet to less than $30, a 12-year low. Analysts predicted that the price could plunge to $20 due to fierce rivalry between oil producers, which suggested there would be no signs of a slow down in production.

But after Saudi Arabia and Russia met in Doha, Qatar and came to an agreement, cheap petrol prices could soon be no more, with motoring groups saying that the end of petrol for under £1 per litre is just 'weeks away'.

Oil prices have already increased from $30 to $34 a barrel and AA spokesman Paul Watters said: "The players in the oil market are seeking to address this glut so the roller coaster will start all over again.

"This has nothing to do with an oil shortage - it’s all about managing the price and drivers are always the victims when something like this happens."

If you need to stock up on fuel you should do so soon before prices rise

And Simon Williams, RAC spokesman added: "The £1 a litre petrol may disappear within weeks as we see a few more dollars added to the price of a barrel of oil."

Saudi Oil Minister Ali al-Naimi admitted price was at the heart of the output freeze, and explained: "We don’t want significant gyrations in prices, we don’t want reduction in supply, we want to meet demand - we want a stable oil price."

While oil ministers from Saudi, Russia, Qatar and Venezuela have agreed to the freeze rather than a cut in production, Iran will now decide have to decide today when it holds talks in Tehran with Iraq and other oil producing nations to state its position.

Until now it has vowed to pump a million barrels of oil a day to play catch-up with rivals following the recent lifting of sanctions, as it had previously had it's oil exports cut.

While the oil giants make decisions on output, there are fears that Britain’s 30 million drivers could be hit with a double blow when it comes to petrol prices as Chancellor George Osborne is eyeing up fuel duty to plug the budget deficit and balance his books by 2019.

Comments

Journalists

Amita Joshi
Chief Reporter
Salina Patel
Hounslow
David Rivers
Ealing
Goolistan Cooper
Hammersmith & Fulham, Kensington & Chelsea, Westminster
Robert Cumber
Hounslow
Emily Chudy
What's On Reporter
Matt Lewis
Sports Reporter
Tom Moore
Sports Reporter
Tim Street
Deputy Sports Editor
Paul Warburton
Sports Reporter