A WEAK pound is hitting motorists in the pocket, despite falling petrol prices.
The currency hit a new 37-year low after a series of tax cuts were announced in Chancellor Kwasi Kwarteng’s mini-budget.
Fuel prices have fallen in recent weeks, providing much-needed relief to motorists hit by the cost of living crisis.
Petrol prices fell below 166p per liter for the first time since May on Wednesday.
But the weak pound adds almost a fiver more to each tank of fuel when filling up at the pumps, according to the AA.
The motor group said a tank would be 9p a liter cheaper if the pound was at its mid-February value against the US dollar – a saving of £4.95.
The pound was worth $1.35 against the dollar earlier this year but has since fallen, hitting $1.14 this week.
Luke Bosdet, the AA’s fuel prices spokesman said: “The impact of the exchange rate is often overlooked when motorists compare oil price movements with those at the pump.”
“At the moment it is critical. Oil and fuel in commodity markets are traded in dollars, which makes the weaker pound very bad news for motorists.”
The price of petrol rose sharply this year due to, among other things, the war in Ukraine.
The highest average fuel prices for the year so far were recorded on July 4, when petrol was 191.6 p.litre and diesel was 199.2 p.litre.
Since then, the cost of filling up a typical 55-litre family petrol car has been cut by more than £14, while refueling diesel models costs almost £10 less.
At the start of the week, petrol averaged 164.78p a liter at the pump, down from 173.46p in August. Diesel has fallen above 3p per liter in the past month to 180.95p on Wednesday.
How can I reduce fuel costs?
There are ways to save an extra 5p per liter if you sign up to a major supermarket’s loyalty scheme.
Esso has partnered with Nectar for their loyalty scheme and you can get 5p off a liter when you redeem 300 Nectar points.
Drivers with a BPme Rewards Card will get one point for every £1 they spend in store or on a liter of regular fuel at a BP workshop.
Motorists will get £1 off their fuel or shopping for every 200 points.
Loyalty card holders from Texaco, Shell, Sainsbury’s and Tesco can also get money on their bills.
You can also reduce fuel costs by driving more efficiently. This can be achieved by:
- Accelerates gradually without over revving
- Always drive in the highest possible gear
- Allow your car to slow down naturally as your brake
There are also sites you can use to help you find the cheapest gas prices near you, such as PetrolPrices.com and Confused.com.
These allow you to search prices at UK petrol stations. All you have to do is enter your zip code and tell it how far you want to travel (up to 20 miles).
It’s also so easy to forget about the mess that occurs in your car – whether it’s tools, children’s toys or general rubbish. But it turns out that additional storage space can increase fuel costs by as much as 12%.
So don’t forget to do a car cleaning every now and then.
And if you drive at a slower speed, think about removing the roof rack and turning off the air conditioning to save on running costs.