Rising petrol costs are said to be putting major pressure on small businesses, as they hit £1.21 per litre, the highest figure since December 2014.
The Federation of Small Businesses (FSB) said fuel costs were a key reason for soaring operating costs at smaller firms, with FSB national chairman Mike Cherry calling on the Government to intervene. He said it was vital prices were not raised this year, after BEIS figures showed fuel had reached a national average.
The weekly UK retail fuel pump announcement from the Business, Energy and Industrial Strategy (BEIS) on 8 January showed a 3 pence rise in ULSP unleaded petrol at £1.21 per litre and a rise of 5 pence for ULSD diesel at £1.24.
By the end of 2017 it was £5 more expensive to refuel a 55-litre tank with petrol, compared with June earlier the same year. The RAC has warned petrol prices could climb further in 2018, possibly causing a knock-on effect on wholesale fuels.
RAC fuel spokesman Simon Williams, said that oil hitting $70 a barrel was potentially very bad for motorists already having to get used to paying 7 pence a litre more for petrol and 9 pence more for diesel than last July.
“If oil stays at this level, pump price hikes will be almost inevitable. This is not the start to 2018 anyone would have wanted. It could also negatively affect business and further fuel inflation.”
Wilfred Mitchell, FSB NI policy chair said the number of members reporting a rise in operating costs was at its highest for five years. Almost a third say fuel prices are a main cause of that increase, up from less than a fifth, this time last year.
“Affordable travel on roads is absolutely vital to the success of small businesses and local economies, especially in rural areas. That’s why it’s critical that the fuel duty freeze set out in the Autumn Budget is continued in future.”
November’s budget stated that in 2018 fuel duty would remain frozen for the eighth year running, saving drivers £160 per year in costs.
Mitchell, added that with Northern Ireland being comparatively more rural than other parts of the UK, higher fuel costs could be particularly detrimental to local businesses.
“Over the coming year, we look forward to the Government doing its upmost to help small firms battle the rapid rise in operating costs. Where vehicles are concerned, that also means taking a hard look at the ever-increasing Insurance Premium Tax (IPT).”
With diesel vehicle owners also set to be hit with significant extra costs once Clean Air Zones are in place he urged Government to step up support for small firms switching to cleaner vehicles.
Williams added: “Looking at the global oil picture it seems as if the glut of oil stocks is disappearing due to the production cuts imposed by OPEC along with non-member Russia, as the United States’ crude oil inventories have fallen for eight weeks in a row. The US is now producing far more from fracking but this isn’t filling the gap from the OPEC cuts.
“If, however, the US’s fracking production increases substantially there is a hope that the price of oil may fall back and settle at the mid-$60 a barrel mark. This would, of course, be far better news for UK motorists.”
Energy UK declined comment.