FUEL duty increases may have been deferred in this year's Budget but new research shows the average weekly price of unleaded petrol in the UK has hit £3.50 a gallon – the highest since May last year.

Forecourt prices at more than 95% of the UK fuel retailer network were analysed by fleet and fuel management company Arval PHH, which operates the AllStar fuel card. They revealed that the average weekly cost of unleaded fuel for the week ending March 19 was 77.68 pence per litre (ppl), which is £3.53 per gallon.

Clive Forsythe, managing director of Arval PHH's Business Customer Division, said: 'It's little wonder that the Treasury deferred these duty increases until September. British forecourt prices are still going up because of the recent upsurge in the cost of crude oil, so to introduce further rises now would have pushed them above the psychological 'break point' of 80 pence per litre.

'That might have been very damaging for the Government.'

The company's figures show that in February the average price of unleaded petrol was 76.88 pence per litre.

The cheapest was to be found in Thanet, Kent, at an average price of 70.80 pence per litre, while the most expensive was Thurso in Caithness, at 85.90 pence per litre.

The average price of diesel in February was 78.42 pence per litre. The cheapest was to be found in Neston, Cheshire, at 73.60 pence per litre, while the most expensive was Helmsdale, Sutherland at 87.80 pence per litre.

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