Labour warns ministers against adding to Britons’ misery with 12p fuel duty hike this spring – as energy boss says higher household bills are here to stay
Ministers are facing increasing pressure to drop a mooted 12p fuel duty hike this spring.
Labour has warned that going ahead with the rise pencilled in by the Treasury would inflict ‘yet another shock’ on our economy.
The intervention came as an energy chief predicted that household bills will not return to the same level as before Covid and the Ukraine crisis.
A ‘temporary’ 5p cut to the cost of a litre of petrol and diesel was brought in by then-Chancellor Rishi Sunak last year.
However, the reduction is due to expire in March – and the Office for Budget Responsibility assumed that fuel duty would also rise in line with inflation.
That suggests a bump of around 23 per cent. Chancellor Jeremy Hunt is believed to be working on ways of keeping the temporary cut and shunning an inflationary rise, but it could cost the Treasury nearly £6billion.
Shadow chancelllor Rachel Reeves has warned that going ahead with the fuel duty rise pencilled in by the Treasury would inflict ‘yet another shock’ on our economy
A ‘temporary’ 5p cut to the cost of a litre of petrol and diesel was brought in by then-Chancellor Rishi Sunak last year, but is due to expire in March
Shadow chancelllor Rachel Reeves told The Times: ‘With so many families and businesses reliant on their cars the government must rule out yet another fuel duty rise at the budget to prevent yet another shock to our economy.’
Meanwhile, the head of Norwegian energy giant Equinor has cautioned that worldwide markets will not return to pre-pandemic prices.
Anders Opedal told the BBC the transition from fossil fuels to renewables would keep costs higher.
‘This will require a lot of investment and these investments need to be paid for, so I would assume that the energy bills may slightly be higher than in the past but not as volatile and high as we have today,’ he said.
Speaking as the World Economic Forum gets under way in Davos, Mr Opedal said society ‘needs to treat energy as something that is not abundant’.
‘I think we have had a lot of cheaper energy in the past and we probably wasted some of it, so we need to make sure we’re making the right investments now [and] everyone [should] use as little energy as possible,’ he said.
The intervention came as an energy chief predicted that household bills will not return to the same level as before Covid and the Ukraine crisis
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