Saturday 12 March 2022 8:19 AM UTC
By A Staff Reporter
LONDON March 12: UK households were already facing sharply rising costs before Russia’s invasion of Ukraine, in part due to soaring energy costs. The conflict in Ukraine pushed the price of oil to its highest level for nearly 14 years at one point and this has had a knock-on impact on fuel costs, with UK petrol prices and cost of household essentials hitting record highs.
Below we look at how the costs have affected daily living.
RAC fuel spokesman Simon Williams said: “The average price of both petrol and diesel climbed to new records again on Wednesday. Unleaded is now 159.57p a litre while diesel increased by another 2p to 167.37p – making for a rise of more than 5p in two days. A tank of petrol is now almost £88 while diesel has now gone over £92.
Supermarket forecourts usually offer the cheapest fuel prices and this is because of the market power supermarkets hold. Companies like Asda, Tesco, Sainsbury’s and Morrisons are all in competition with one another, so they keep fuel prices as low as possible hoping that when motorists come to fill their tank, they might do their weekly grocery shopping, too.
Higher energy prices will first be felt in petrol prices and then potentially energy bills (for businesses, as well as households). There has been much speculation that the domestic price cap will have to be increased substantially later in the year.
Gas prices have also soared, leading to warnings that average energy bills could reach £3,000 per year in October, after rising to £2,000 in April when the energy price cap is raised.
Russia and Ukraine are also large producers and exporters of agricultural products, such as wheat, and some metals. Prices for these products have also risen on financial markets, potentially leading to future increases in food and materials prices in the UK.
House price growth in Britain hit a new eight-month high in February as the housing market showed little sign of losing momentum amid a growing cost-of-living squeeze, a survey showed on Thursday.
The Royal Institution of Chartered Surveyors (RICS) said a net balance of +79% of its members reported a rise in house prices in February, up from +74% in January and its highest since June. A Reuters poll of economists had pointed to a reading of +73%.
A hike in fuel costs will increase the price of groceries and food in restaurants, the Federation of Wholesale Distributors has warned, as drivers and businesses were hit by a daily rise in diesel prices.
The UK government briefing published on 7th March 2022, gives an overview of rising prices, particularly food, energy and fuel prices, including the potential impact of the conflict in Ukraine. In addition, other pressures on household budgets like changes to taxes and benefits are discussed, along with the effect of the rising costs of living on low-income households, which are likely to be disproportionately affected.
With increasing costs for almost all household essentials it is time we turn to some advice on these matters. Money Saving Expert website is a good place to do comparisons and make decisions before we buy utilities.
Martin Lewis OBE is an English journalist who created the website MoneySavingExpert.com to give advice on money saving techniques to consumers.
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