Fuel prices may still be on the up, but you can keep petrol costs under control this summer with a new credit card deal.
Petrol prices look set to remain eye-wateringly high this summer as experts predict that the price of oil will continue to rise throughout 2011.
At the end of May, US bank Goldman Sachs announced revised forecasts for the price of Brent crude, which it now thinks will hit $120 a barrel by the end of this year (up from a previous estimate of $105) and $140 (up from $120) by the end of 2012.
This is further bad news for UK motorists who, despite cuts in fuel duty announced by George Osborne in his March Budget and a supermarket price war in early May, are still paying significantly more for fuel than at the start of the year.
But a new credit-card offer from Barclaycard – see details below – could give drivers some respite from the soaring cost of filling their tanks with .
More rises, more pain
The AA said that rapid price rises towards the end of April meant that, even with a slight fall in the oil price and a battle between leading supermarkets to undercut each other, the average cost of a litre of unleaded rose 1.1p in May to 136.9p. Diesel was down fractionally by 0.5p to 141.5p.
But the motoring organisation did hold out some hope for short-term price falls, pointing out that the lower oil price could result in a fall in forecourt costs which “could potentially reduce the pump price of petrol by 4p a litre”.
Indeed, figures from Petrolprices.com suggest that garages are starting to bring their prices down marginally, with the UK average for a litre of unleaded falling to 135.83p by the start of June.
Whether oil companies will pass on their savings in full to consumers remains to be seen, however.
Better recovery equals higher oil prices
Goldman Sachs’ longer-term view of rising crude values is based on expected increases in demand for fuel by both consumers and industry as growth picks up in global economies.
However, new figures in both the UK and US suggest recoveries in each country may be more sluggish than many analysts had hoped. This could be good news for petrol costs, although of course a lack of growth is likely to affect consumers negatively in a number of other ways.
Get cashback on petrol purchases
Whatever happens to fuel costs this year, a new credit-card deal from Barclaycard means you can save up to £30 on the cost of filling your tank.
The offer applies to the lender’s Platinum, Gold and Initial cards taken out before 27 June, and works like this: borrowers get 10 per cent cashback on any petrol or diesel purchase made before 31 August 2011, up to a maximum of £30.
So if you fill up five times at £60 per tank, you’ll get the maximum £30 cashback.
The cards also offer interest-free balance transfers for up to 20 months, and up to three months’ interest-free spending.
Watch out for the catches
There’s no such thing as a free lunch, and there’s a reason why banks make attractive offers like this: they expect a certain proportion of their customers to run up high interest charges or to lose out on incentives by missing payments or settling their bills late.
So make sure you don’t end up paying too much for your borrowing or missing out on the cashback you were expecting by following these tips:
- Never miss your monthly minimum repayment. If you do, your bank could end any 0 per cent interest deal you are on, or refuse to give you any incentives you have qualified for: if you check the terms and conditions, you will see they are fully entitled to do so.
- Set up a direct debit so the money is guaranteed to go to your lender on time.
- If you transfer money to a interest-free deal, work out how you are going to clear your debt before the 0 per cent period runs out. If do don’t do this, you’re likely to be hit with high interest charges further down the line.
You can get a break down of how much you spend on petrol with our fuel cost calculator.
