Predicting petrol prices in an increasingly unpredictable world isn’t an easy thing to do! However, that doesn’t mean we cannot try.
As we head into 2017, it’s inevitable that we’ll wonder what the new year may have in store for motorists, so in this article, we’ve summarised some of the things we think may come to pass.
Clearly, our predictions can be little more than conjecture, especially as they become more long-term, so please take them in the light-hearted manner intended. It will be fun to look back on these in a year’s time and see just how educated our “educated guesses” turned out to be!
Winter 2017 (January – March)
After seeing petrol prices shoot up in December, we think it’s likely there may be some stabilisation as we head into the New Year, particularly by the end of January – when the world will be watching the inauguration of President Donald Trump.
Once Trump takes the keys to the White House, there’s a strong possibility that there will be downward pressure on the oil price, which will hopefully lead to falling petrol prices. While time will tell exactly what kind of protectionist decisions Trump makes, a pro-fossil fuels and pro-fracking president is likely to want to boost national production, which could put pressure on OPEC and other nations to lift their production caps to compete.
While it’s impossible to predict how financial markets will react, there’s also a chance the Dollar will fall once Trump takes office. If it does, this could also contribute to cheaper consumer fuel in the UK.
Spring 2017 (March – June)
The 20th March is the first day of spring in the UK, and the end of March is Theresa May’s target date for invoking Article 50 to begin Britain’s withdrawal from the EU. As such, it’s likely British eyes will turn away from the US and back to more local matters by the time the clocks change!
It’s almost impossible to predict what will happen to petrol prices around the invocation of Article 50, especially because we don’t know at the time of writing whether it will definitely be invoked in March at all. If it is, there’s a change it may result in another fall in Sterling, which is likely to push petrol prices up – to what degree is impossible to say. If it seems as if the UK may be heading for a “soft” Brexit, we could see the opposite happen, with Sterling strengthening and fuel prices falling instead.
Spring will also be time for another budget – the last before the spring budget becomes the “Spring Statement.” With all eyes likely to be firmly on Brexit, another fuel duty freeze seems most likely at this point.
One thing the budget is likely to address, however, is a way to finally deal with the nation’s lack of progress against emissions targets. The likelihood is that the spring budget won’t be a happy one for diesel drivers.
Summer 2017 (June – September)
The Geneva Motor Show takes place in summer 2017, and we expect electric cars to be big news. While there are only 1.5 Million electric cars globally (at the time of writing) and 1 Billion fuel driven vehicles, electric car adoption is growing ten times faster. This could go as far as affecting fuel prices if oil producers begin to worry about a potentially shrinking market.
Autumn 2017 (September – December)
As we head to Autumn 2017 our predictions must, by their nature, be somewhat bolder but potentially less accurate!
Britain will have its first Autumn budget, and we predict it could prove to be one of the most important budgets in recent history. The Chancellor will need a stimulus package for the next year that will reduce the national debt burden. However, he will also have to invest in growth to offset inflationary pressure and increase productivity.
At this point, we’re into the realms of educated guesswork, but we cautiously predict that the Chancellor will make a huge bet that the value of the Pound will rally against the Dollar. Combined with Trump’s USA increasing oil production capacity, this should bring fuel prices down. However, after eight years of fuel duty freezes, we can’t help but wonder if there’s not a good chance the government will finally raise this duty by 2.05 pence to make it 60 pence per litre.
2017 is going to be another difficult year for fuel prices with many significant events taking place that could impact costs – upwards or downwards.
While it seems highly unlikely that we’ll see extremes of pricing near the 145 pence per litre levels of 2012, we do expect prices to reach between 120-130 pence per litre at certain points in 2017.
So now, over to you! What do you think of our predictions, and what are yours? Let us know in the comments section below!
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