Fuel prices continue to drop

MOTORISTS can expect to buy a litre of petrol for less than 90p at most filling stations in the area today.

Tom Potter

MOTORISTS can expect to buy a litre of petrol for less than 90p at most filling stations in the area today.

Oil prices slumped yet again this week to $53.25 a barrel - falling from a record $147.27 reached in July when forecourt prices peaked at just under 120p a litre.

The RAC has calculated the plummeting price of Brent crude means it costs £17 less to fill up the average car than it did at the beginning of the summer.

In Ipswich, the cheapest litre of petrol and diesel can be bought from the Shell garage on Orwell Bridge, but prices are relatively similar across the town.

It's only when drivers reach Stowmarket that they must fork out up to four pence more at the Cedars Link Tesco and Combs Ford Esso garages.

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Supermarkets in Ipswich are leading the price war with petrol below 90 pence per litre - completing a 30 pence drop in the space of four months. Wholesale prices would be even lower if not for the weak value of the pound.

This week's proposed VAT reduction on petrol is due to be offset by increasing duty by 2p a litre - an amount which should keep the overall cost the same next year.

The decision to offset a 2.5 percentage-point cut in VAT upset hauliers who argued they will be hindered in their ability to compete with overseas companies.

But Alistair Darling requested oil companies pass on falling oil prices to customers after BP and Shell reported record quarterly profits last month.