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In UK petrol retail terms, 2017 will be seen by many as a good year for fuel price changes because increases stayed below the rate of inflation and meant the economy stayed in better shape from a consumer expenditure perspective.

But in geo-political terms there was a great deal of change, perhaps reflected in the price of crude oil over the year, which started at $56 a barrel in January, fell gradually to $44 a barrel in June and rose steadily returning to $56 a barrel in December and is now consistently above $60, the highest level since 2015.

Declines in the value of oil were driven by uncertainty about the global economy due to the incoming US President Donald Trump and what would happen with global oil production agreements laid out by OPEC and informal agreements between states outside of OPEC, such as Russia. UK fuel prices declined at the start of the year due to this, but increased in the second half of the year because oil production agreements were ratified, coupled with a series of small disasters that temporarily impacted oil and gas supplies into the UK market.

Fuel prices move in a narrow range

The cost of petrol and diesel in 2017 fluctuated by no more than 6.1 pence for Unleaded and 7.9 pence for Diesel. To put that into context fuel prices changed by 28.5 pence during the 2008 global financial crash and by 13.6 pence in 2016. What is interesting is that prices have changed in a big v shape over the year following the global price of crude oil per barrel, (see illustration).

The year started with figures at a relatively low level of 115.2 ppl Unleaded and 121.7 ppl Diesel in January and rose by 5 pence in February to 120.2 ppl. A lot of this driven by negative market sentiment and currency changes because of Donald Trump becoming US President. In March prices started to steadily decline until July where they reached their lowest point of 114.7 ppl Unleaded, 115.4 Diesel. From then on prices have been slowly creeping back up, ending at 120.8p Unleaded and 123.3p Diesel.

Manchester leads way in cheapest towns

If we look at the cheapest UK towns for fuel prices in 2017, Dunkinfield in North Manchester and Leigh in Greater Manchester lead the way followed by Tilbury, Spennymoor and Loanhead. There are a few surprises on there too, Penzance in Cornwall being the 4th cheapest for Unleaded in 2017 for example.

Cheapest areas for Unleaded in 2017

  1. 112.6 – Leigh, Greater Manchester
  2. 112.7 – Dukinfield, Greater Manchester
  3. 113.3 – Tilbury, Thurrock
  4. 113.3 – Penzance, Cornwall
  5. 113.4 – Loanhead, Midlothian
  6. 113.5 – Spennymoor, County Durham
  7. 113.5 – Cwmbran, Torfaen
  8. 113.6 – Pembroke Dock, Pembrokeshire
  9. 113.7 – Pudsey, West Yorkshire
  10. 113.7 – Port Glasgow, Inverclyde

Cheapest areas for Diesel in 2017

  1. 114.2 – Dukinfield, Greater Manchester
  2. 114.3 – Tilbury, Thurrock
  3. 114.5 – Leigh, Greater Manchester
  4. 114.8 – Spennymoor, County Durham
  5. 114.8 – Loanhead, Midlothian
  6. 115.0 – Tamworth, Staffordshire
  7. 115.2 – Pembroke Dock, Pembrokeshire
  8. 115.3 – Harworth, Nottinghamshire
  9. 115.5 – Abertillery, Blaenau Gwent
  10. 115.6 – Port Glasgow, Inverclyde

Scottish Highland towns remain most expensive

As usual the Scottish Highlands and UK islands dominate the most expensive towns for fuel in 2017. Tighnabruaich and Acharacle in Scotland for Unleaded and Diesel are followed by Freshwater on the Isle of Wight. Markfield in Leicestershire is one of the surprises, as well as Woolacombe in Devon.

Most expensive areas for Unleaded in 2017

  1. 133.7 – Acharacle, Highland
  2. 132.9 – Tighnabruaich, Argyll and Bute
  3. 129.9 – Freshwater, Isle of Wight
  4. 129.1 – Isle of Benbecula, Eilean Star
  5. 128.7 – Woolacombe, Devon
  6. 128.2 – Gretna, Dumfries & Galloway
  7. 127.8 – Lockerbie, Dumfries & Galloway
  8. 127.3 – Markfield, Leicestershire
  9. 127.0 – Isle of Arran, North Ayrshire
  10. 126.9 – Totland Bay, Isle of Wight

Most expensive areas for Diesel in 2017

  1. 135.3 – Tighnabruaich, Argyll & Bute
  2. 134.4 – Acharacle, Highland
  3. 131.7 – Freshwater, Isle of Wight
  4. 131.2 – Markfield, Leicestershire
  5. 131.1 – Isle of Benbecula, Eilean Star
  6. 129.9 – Woolacombe, Devon
  7. 129.4 – Totland Bay, Isle of Wight
  8. 128.1 – Isle of Islay, Argyll & Bute
  9. 127.9 – Cowes, Isle of Wight
  10. 127.6 – Gretna, Dumfries & Galloway

ASDA Tamworth and Newport cheapest stations in UK

In terms of cheapest stations overall in 2017 the supermarkets dominate the listings. ASDA Tamworth and Newport, Isle of Wight are the most consistently cheapest. Tamworth has the greatest number of low cost stations in the UK, but isn’t the cheapest town overall because it also has a small group of much higher priced stations in the same vicinity.

ASDA Newport, Isle of Wight is a real surprise when you can see that the island is consistently in the most expensive locations in the UK, but this perfectly illustrates the importance of price spread between cheapest and highest, perhaps felt more on the Isle of Wight than anywhere else in 2017.

Cheapest Unleaded stations on average in 2017

  1. 109.8 – Asda Tamworth, Tamworth
  2. 109.8 – Asda Newport, Isle of Wight
  3. 110.6 – Sainsburys Tamworth, Tamworth
  4. 110.9 – Morrisons Tamworth, Tamworth
  5. 111.0 – Asda Harwich, Harwich
  6. 111.2 – Asda Leigh, Leigh
  7. 111.6 – Avondale Service Station, Cwmbran
  8. 111.6 – Sainsburys Leigh, Leigh
  9. 111.7 – Morrisons Leigh, Leigh
  10. 111.7 – Asda York, York
  11. 111.8 – Asda Bridgwater, Bridgwater
  12. 111.9 – Morrisons Keighley, Keighley
  13. 112.0 – Asda Keighley, Keighley
  14. 112.0 – Sainsburys Keighley, Keighley
  15. 112.1 – Morrisons Bridgwater, Bridgwater
  16. 112.1 – Asda Bishop Auckland, Bishop Auckland
  17. 112.1 – Sainsburys Monks Cross, York
  18. 112.2 – Sainsburys Bridgwater, Bridgwater
  19. 112.2 – Asda Horwich, Bolton
  20. 112.3 – Tesco Atherton, Manchester

Cheapest Diesel stations on average in 2017

  1. 109.4 – Asda Newport, Isle of Wight
  2. 110.7 – Asda Tamworth, Tamworth
  3. 112.2 – Sainsburys Tamworth, Tamworth
  4. 111.5 – Morrisons Tamworth, Tamworth
  5. 112.9 – Asda York, York
  6. 112.9 – Asda Leigh, Leigh
  7. 113.1 – McColls Tamworth, Tamworth
  8. 113.2 – Sainsburys Leigh, Leigh
  9. 113.2 – Morrisons Leigh, Leigh
  10. 113.3 – Sainsburys Monks Cross, York
  11. 113.3 – Asda Bridgwater, Bridgwater
  12. 113.6 – Sainsburys Hankridge Farm, Taunton
  13. 113.6 – Morrisons Taunton, Taunton
  14. 113.6 – Asda Keighley, Keighley
  15. 113.6 – Asda Taunton, Taunton
  16. 113.7 – MPK Drayton Service Station, Tamworth
  17. 113.7 – Morrisons Keighley, Keighley
  18. 113.8 – Asda Minworth, Sutton Coldfield
  19. 113.8 – Asda Kettering, Kettering
  20. 113.8 – Morrisons, Kettering

London has most expensive stations in UK

Outside of motorway service stations, (which would dominate the top 20 if they were included), there are two petrol stations in London that actively compete against each other to be the most expensive in the UK. Chelsea Cloisters, Sloane Square has held the title of most expensive for many years until 2017. Less than a mile away, Holland Road Service Station have set a new record for fuel prices. Their average price in 2017 is an eye watering £1.75 a litre for Unleaded and Diesel, more than 25 pence a litre higher than Chelsea Cloisters, who were the previous most expensive station in the UK at £1.50 a litre. Not surprisingly apart from motorway services, the A1 (M1) had six of the most expensive stations on the list, followed by a few independent stations in the Scottish Highlands.

Predictions for fuel prices in 2018

Most experts predict that in the first half of 2018, fuel prices will increase slightly but will not rise beyond a certain point. A lot depends on US shale oil producers, how OPEC will respond to them and what happens to the global economy. Brexit can and will play a part if negotiations don’t go well, the value of Sterling will be impacted negatively against the dollar, so the price of fuel at UK pumps will rise as a result, but it could also go the opposite way, good trade talks and there is more confidence about the economy, Sterling’s value rises and fuel prices could fall.

The growth of electric and hybrid vehicles passed 3 million globally in 2017 and is expected to smash 5 million in 2018. What alternative energy does is make the markets question the value of oil for the long term and this could have a knock-on effect with current fuel prices and petrol retailers own plans. So too the impact of pollution, the demonisation of Diesel may continue to escalate leading to increases in duty on fuel for the first time in 8 years at the next Budget.

What do you think about the cost of fuel in 2017? Did you think it was too high or was it about right? Which way do you think fuel prices are going to go in 2018? Let us know in the comments below.

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