Petrol hits £1.40 per litre as growing fury prompts Osborne to hint at fuel duty U-turn

Protesters warned of a fuel price ‘crisis’ last night after the cost of unleaded petrol hit £1.40 a litre – £6.37 a gallon.

Campaign group Fair Fuel UK said that the price charged at a BP garage in Kent was the highest so far in Britain.

The forecourt on the M2 near Rainham, Gillingham, was also selling a litre of diesel at £1.44 – about £6.55 a gallon.
The findings came as Chancellor George Osborne hinted that a 1p fuel duty hike due next month will be scrapped amid fears over soaring oil prices.

The Chancellor said in a speech to the Conservative spring conference in Cardiff that he had ‘heard’ protests from motorists being ‘squeezed’ by rising costs at the pump.
'I hear you': Chancellor George Osborne yesterday giving a speech in which he hinted the planned 1p rise in petrol duty in April would be scrapped

'I hear you': Chancellor George Osborne yesterday giving a speech in which he hinted the planned 1p rise in petrol duty in April would be scrapped

Mr Osborne signalled he was ready to ease the pressure by dropping the increase in his Budget later this month.

He told delegates: ‘I know how hard the rises in world oil prices are hurting families in Britain.

‘We’ve got another of the Labour Party’s pre-prepared rises in petrol tax coming this April – one penny above inflation.

'When it costs £1.30 for a litre of petrol, £80 to fill up a family car, I know people feel squeezed.

‘And I say this to people watching: I hear you.’

Energy Secretary Chris Huhne today told The Observer that Britain's only option was to speed up the move away from oil.

He said: 'We cannot afford to go on relying on such a volatile source of energy when we have clean, green and secure energy from low-carbon sources.'

Despite Liberal Democrat doubts, the Treasury is also still believed to be looking at the idea of a ‘fair fuel stabiliser’ – where duty is reduced or raised to offset oil price movements.

The Chancellor also said the crucial March 23 package would include a series of measures to boost growth and tackle the ‘forces of stagnation’ in the economy.

But Shadow Chief Secretary to the Treasury Angela Eagle said Mr Osborne was offering ‘nothing more than platitudes for millions of families facing

the squeeze’.

She said: ‘With record high prices at the petrol pump, people want action not warm words from George Osborne.

‘He should listen to Labour’s campaign and act right now to help millions of families by reversing the Tory VAT rise on petrol.

‘In the Budget he should look again at the annual duty rise due in April.

'The last Labour Government often postponed planned duty increases when world oil prices were rising, as they are now.

‘If George Osborne wants to tackle the forces of stagnation he should look in the mirror.’

And one of Mr Osborne’s colleagues warned that the turmoil in Libya and the Middle East could drive petrol costs higher still.

International development Minister Alan Duncan – a former oil trader – said the current cost could look like a ‘luxury’ if the situation deteriorated.

He said he feared the price of petrol could soar above £2 per litre.