As it was discovered that drivers are paying an additional £5 for a tank of gas due to the decline in the value of the pound, Kwasi Kwarteng said he was prepared to “engage” with a request to lower fuel tax.
According to an analysis by the AA, if the pound had remained at its mid-February value of $1.35 rather than this week’s level of $1.14, the price of gasoline at UK forecourts would have been “at least” 9p cheaper per litre. It dropped yesterday to $1.09.
The differential in pump pricing raises the expense of filling up a standard 55-liter family vehicle by almost £4.95.
Following the Chancellor’s mini-Budget announcement in the Commons, Conservative MP Robert Halfon pleaded with him to “please do all he can to decrease fuel tax” in the next Budget.
I’d be pleased to engage my right honourable friend on that, Mr. Kwarteng retorted.
The reductions in pump prices brought about by the price of oil returning to its pre-Russian invasion Ukraine level are being “severely undercut,” according to the AA.
When drivers compare changes in oil prices to those at the pump, they often underestimate the impact of the exchange rate, a representative for the company said.
The weakening pound is terrible news for drivers since oil and petrol are sold on commodities markets in dollars.