Diesel prices set to climb
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El Pump prices are expected to escalate again as crude oil commands its highest price in a decade on International markets.
Brent Crude peaked at around $32 a barrel last week— its highest price since the Gulf War pushed prices upward 10 years ago.
Pundits are now predicting an inevitable knock-on effect at the pump despite the price of a litre of diesel dropping by around 5p last week.
OPEC, the consortium of oil-rich countries, exerts a strong influence over the price of crude by restricting or expanding production.
In March this year it established a new mechanism which would increase production by 500,000 barrels a day if the price remained above $28 a barrel for 20 consecutive days. The mechanism will be triggered next week if prices, as expected, remain high.
Keith Greenhead, director of PHH's fuel management division, warns that bulk diesel prices will probably rise within a month.
"It's a 'Catch 22' situation," says Greenhead. "We want oil prices to remain high in the short term so that extra oil is produced and prices will then hopefully stabilise."
Oil prices will also be susceptible to change in the next few months as winter descends on the Northern Hemisphere, increasing demand for heating oil.