Petrol prices yesterday hit a record average level of 121.76p for a litre of unleaded petrol.
It is expected that fuel prices will rise daily up to January, when VAT is increased to 20%. This will add 2.5p and fuel duties will add a further 1p a litre to prices.
The current diesel price of 125.73p a litre is 8p away from a record high.
More price rises are on the way, the latest Office for National Statistics factory gate inflation figures show.
The ONS reported yesterday: ‘Output price “factory gate” annual inflation for all manufactured products rose 3.9 per cent in November.
‘Month on month the output prices measure for all manufactured products rose 0.3 per cent between October and November, mainly reflecting price rises in petroleum products, food products, and computer, electrical and optical products.
‘The “narrow” output prices measure, which leaves out volatile sectors, showed an annual rise of 3.3 per cent.’
The AA said in a statement: ‘Average UK petrol prices have hit a new record. The latest price (from yesterday’s fuel receipts) is 121.76p a litre for petrol and 125.73p for diesel.
‘Record prices for both were: petrol 121.61p set on 12 May 2010, and diesel 133.25 set on 17 July 2008.
‘Price comparisons: Beginning of 2010: petrol averaged 109.88p a litre, diesel 111.52.
‘Difference: petrol 11.88p a litre more expensive now, diesel 14.21p.
‘Extra cost of tankful: petrol – £5.94, diesel – £7.11.
‘Extra monthly cost of petrol for a two-car family – £25.23.
‘A year ago (8 Dec 2009): petrol averaged 108.91p a litre, diesel 110.17.
‘Difference: petrol 12.85p a litre more expensive now, diesel 15.56.
‘Extra cost of tankful: petrol – £6.43, diesel – £7.78
‘Extra monthly cost of petrol for a two-car family – £27.29.’
AA president Edmund King said: ‘In the past week, we have seen the average price of petrol shoot up 1.7p a litre across the UK and diesel rise 1.61p.
‘It comes at a particularly bad time for drivers who have struggled with appalling winter weather and often seen their fuel drain away while stuck in snow-bound traffic jams.’
He warned: ‘If current prices persist, the new year increase in fuel duty and VAT will push petrol prices up to 124p a litre.
‘Our only hope is that either oil and fuel markets settle back down or the pound strengthens against the dollar.
‘Until then, it is an even more uncomfortable ride for families trying to keep their cars on the road.’
RAC motoring strategist Adrian Tink said: ‘It’s unbelievable to think that, compared with this time last year, petrol is 13p a litre more expensive. That’s over £7 more every time you fill up an average tank.’
He added: ‘We have seen five rises in fuel duty in the past two years. And we’re due another one in January, plus a VAT rise.
‘Who knows what the price will be come January 5 2011? An average of 125p per litre is very feasible.’
Commenting on the VAT tax hike, a TUC spokesman told News Line: ‘This is a regressive tax that hits the poorest harder than the richest.
‘As the government looks to cut the deficit, rather than cuts and tax hikes that hit the poor it should look to jobs and growth and spreading the tax burden so those with the broadest shoulders pay most.
‘Petrol prices rises, like VAT, will hit the poorest rather than the rich.’