Petrol sells for less than £1 per litre – the lowest its been in UK for 15 years

The price of a litre of petrol in Britain has fallen to below £1 per litre for the first time in 15 years with the cost of filling up a tank now £6 cheaper than a month ago, it was revealed today.

The Murco garage on the A435 near Kings Heath, Birmingham, has cut the price of unleaded to 99.7p – when seven weeks ago the same litre of petrol typically cost between £1.25 and £1.42 in the UK.

Wholesaler Costco has also cut the price of petrol to 99.9p-a-litre this week, though this is only available to those who pay an annual fee a membership.  

Petrol prices were last at that level in Britain in August 2005 on the back of Hurricane Katrina causing damage to oil and refinery operations in the Gulf of Mexico and the southern states of the United States. 

Coronavirus and price war between the Russians and Saudi Arabia has seen the price of a barrel of oil fall by an astonishing 60 per cent since the New Year to an 18-year low of $24.52.  

An employer at the Murco garage told Birmingham Live that the price of petrol had been cut below £1 per litre on Tuesday, and said it was likely to stay at least as low as that for a while.

He said: ‘The pandemic is affecting business because it is limited the number of people who are coming out.’

It came days after two of Britain’s major supermarkets have cut petrol prices by a record 12p per litre in a single day as the global coronavirus crisis bites.

Both Morrisons and Asda slashed their unleaded fuel by 12p a litre, and diesel by 8p – down to as low as around £1.04 for petrol, 1.11p for diesel.  

Pieces on forecourts nationwide are now at their lowest for years. Yet while the reduction seems a welcome piece of good news, it comes only after petrol stations have been attacked for failing to pass on their wholesale savings to motorists.

The price of a barrel of oil has fallen by an astonishing 60 per cent since the New Year, partly because of an international oil price war between Saudi Arabia and Russia, but largely because the spread of Covid-19 has led to a huge reduction in industrial and other activity globally.

The introduction of sweeping controls on people’s movement, including now in Britain, has also led to a huge fall in consumer demand for petrol. With fewer people going out to work, roads and car parks are visibly much emptier.

There have also been disputed concerns about the risk of virus transmission in using petrol pumps – which can be removed by wearing gloves and cleaning hands.

RAC fuel spokesman Simon Williams said in response to the Morrisons and Asda cuts: ‘These unprecedented times are leading to unprecedented price cuts on fuel – the largest single cut from a retailer we’ve ever seen.

‘Drivers can expect to see petrol sold at supermarket forecourts for around 104p per litre as a result of these cuts, a price last seen nearly four years ago. Diesel should drop to around 111p per litre.

‘The price of oil has fallen so far – down to an 18-year low – that it was inevitable that pump prices would eventually follow suit.

‘These savings will directly benefit those people who continue to rely on their vehicles for essential journeys.’

But Mr Williams added cautionary notes to the otherwise good news – saying that a price war threatened the survival of smaller independent forecourts, already suffering from their bigger overheads and the slump in trade from even voluntary lockdown.

And he reminded motorists that when filling up with cheap fuel they should remember the new rules, saying: ‘Follow the social distancing guidelines and use disposable gloves when handling pumps.’

And AA fuel price spokesman Luke Bosdet said: ‘Such a huge cut in pump prices is very welcome. It is one of the few bright spots in an otherwise gloomy outlook.

‘The key benefit of the slashed prices is in reducing costs for deliveries as online and other firms work hard to keep goods moving and consumers supplied.

‘However, we urge drivers to think carefully before making unnecessary road trips that may put them in proximity of other people.’

Announcing the Morrisons price cut yesterday, the chain’s head of fuel Ashley Myers said: ‘We are playing our full part in reducing the cost of living and feeding the nation. This reduction in fuel prices will help motorists to save money at this difficult time.’

Asda had introduced its identical price cut earlier in the day – but a source said that it chose to keep the reduction quiet, to avoid prompting any increase in people out and about as attempts to stop to spread of coronavirus continue.

Can I drive, fill up with petrol and get my car serviced? We reveal what motorists need to know during the coronavirus lockdown

With strict restrictions in place to prevent people from leaving homes and gathering in groups, motorists with scheduled car maintenance might wonder if they can still have work carried out on their vehicles. 

MOT tests, servicing, repairs, filling up with fuel and collecting motors just purchased will be top of the agenda for owners, especially those deemed critical workers who are relying on their cars.

This is Money explains what the Government has said so far and which services are impacted.

Can I still drive my car? 

Yes, you’re still allowed to use your car, but the government has recommended this should be only for one of a number of approved reasons.

This includes shopping for essentials, travelling to a location to undertake daily exercise, attending a medical appointment, assisting an elderly or vulnerable person, or getting to or from work if you can’t work from home. 

While there are no current measures in place to shut roads, the Prime Minister has told people not to leave their homes for any other reason than those listed above.

This means it is inadvisable for motorists to take advantage of partially deserted roads just to go for a drive on their own. And anyone caught doing so by police while restrictions are in place could face a fine.

Which parts of my car do I need to clean?

With the spread of coronavirus restricting most Britons to home, it’s become essential for people to keep their houses scrupulously clean.

However, the same level of attention also needs to be paid to your car if you intend to use it for unavoidable travel requirements. 

There are multiple surfaces in vehicles that need special attention – 40 in fact, according to Toyota. They are listed below.

Can I get my car MOT tested?

Owners of cars, vans and motorcycles have been granted a six-month exemption from MOT testing from 30 March, the Department for Transport has confirmed.

It says this will enable drivers and riders to to continue to travel to work where this absolutely cannot be done from home, or shop for necessities.

That means that if you have an MOT due from 30 March 2020, the next test date will be extended by six months.

This measure will be in place for the next 12 months, the DfT confirmed. 

However, the statement adds that vehicles must be ‘kept in a roadworthy condition’, and those found at the controls of unsafe motors can be prosecuted. 

See the instruction below for what to check on your car to ensure it’s safe to drive. 

Grant Shapps, Transport Secretary, confirmed that garages would be kept open.

‘Safety is key, which is why garages will remain open for essential repair work,’ he explained.

The DfT also provided information to those who haven’t been able to get their vehicle MOT tested in recent days because they’ve been self isolating after showing symptoms of the virus. 

It said it is working with insurers and the police to ‘ensure people aren’t unfairly penalised for things out of their control’.

MOT tests for heavy goods vehicles, trailers and public service vehicles – such as buses – has also been suspended for three months from March 21. 

Vehicles in these groups that are due to have an MOT expire during this period will be issued with a three-month exemption certificate to allow them to remain on the road with the provision that they are tested as soon as the ban lifts.

Will I be able to get my car serviced? 

While the Government insists you will still be able to get your car serviced, many franchised dealerships are having to close due to the virus pandemic, which could hit the workforce in their dedicated servicing centres. 

The National Franchised Dealers Association has called on the government to ensure that ‘essential’ repair and maintenance services for vehicles will not be shutdown as part of wider closures of shops to ensure critical workers are driving safe cars that are mechanically sound.

If you’re self-isolating due to having the virus, the recommendation is that you don’t leave home – which is causing concerns for those with newer cars with servicing plans that require them to have their vehicles checked under warranty requirements.

If you own a car with a ‘variable servicing agreement’ based on mileage, you don’t need to worry as it won’t be acquiring miles during the time you’re self-quarantining. 

That said, if your motor is subject to fixed servicing intervals determined at specific times, there isn’t as much clarity. 

Most manufacturers allow a grace period of around one month or 1,000 miles to have the car tested before the warranty is invalidated by a lack of care on the owner’s part. 

The Motor Ombudsman recommends anyone in this situation should contact the car manufacturer for advice. 

With dealers closing this week and unable to facilitate this, you are likely to need to call the brand’s head office.

Services to make MOTs, servicing and repairs easier and safer during pandemic

There are a number of services that allow for no-contact collection and delivery of vehicles for all maintenance requirements. 

Comparison site BookMyGarage says it has seen a rise in the number of garages offering no-contact services.

Some are offering this for free and all the motorist has to do is inform the garage of where they have left the keys. 

The person collecting the car will also be wearing protective gloves and use other protective equipment as appropriate when collecting and returning the vehicle.

The no-contact delivery and collection is being offered to those who need it, including NHS staff, other key workers, as well as those who require the service during these unprecedented times.  

Fixter, an end-to-end online car maintenance service, confirmed its business is booming, experiencing its single busiest day on record on Wednesday 18 March.

It said that in the Covid-19 crisis, customers are valuing the ‘physical contact free’ Fixter service, with their cars picked-up then serviced or maintained before being dropped back at their homes. 

The company has also introduced a sanitising cleanse for cars, before they are returned to customers, including a wipe down of the steering wheel, gear knobs, driving controls and handles.

There are also specialist services being offered to those still having to work.

For instance, Halfords is providing a free ten point car check  – normally worth £15 – to all NHS frontline workers during the coronavirus pandemic. 

The checks, which includes top-ups of tyre inflation, screen wash and checks on oil levels, headlights and brake lights, are intended to help keep vital NHS workers moving at this critical time.

What about safety recalls?

A This is Money reader told us they had been turned away from an appointment for a safety recall on their Toyota Prius due to the dealership being closed during the virus outbreak.

The recall is for a seatbelt fault.

Toyota said it is setting up a skeleton workshop to deal with vehicles in order of importance. 

Taxing and insuring a vehicle unaffected

With Vehicle and Excise Duty shifting from paper discs to online in 2014, motorists can renew their car tax online using the government website.

With MOTs due to expire after 30 March being extended by six months, motorists can use their existing MOT certificate when taxing and insuring their car. 

The restrictions of movement should also not impact insurance and breakdown recovery policy renewals, which can be placed online. 

Can I still fill up with fuel?

Petrol stations remain open, for now. And prices at the pumps are falling.

However, under the directive of the Government, it will mostly be critical workers who can take advantage of cheaper petrol and diesel.

This week, Asda and Morrisons both announced cuts of up to 12p-a-litre on petrol due to the fall in wholesale fuel prices due to the crash in oil value in the last fortnight. 

Motorists are told then can go for an ‘occasional drive’, as long as they do not get out of the vehicle and chat with anyone. This includes to deliver food and medicine to those who are in isolation.

Drivers are recommended to wear gloves if they do visit a fuel station, as petrol  pumps – like any other hard surface – handled by other users can spread the virus.

Public Health England says: ‘Petrol pumps are no worse than other surfaces, although we do recommend people use gloves and wash their hands after using them.’ 

All driving tests cancelled 

All driving tests have now been cancelled for three months.

However, there is currently an exemption for those with a ‘critical need’, such as NHS workers and potential delivery drivers. 

The suspension lasts up to and including 20 April 2020 for theory tests and for up to three months for driving tests.

This applies to all types of theory tests, driving tests and approved driving instructor (ADI) standards checks.

Transport Secretary Grant Shapps said: ‘It is vital that those who need a test can get one so DVSA is offering tests to those who have a critical need, such as the NHS and drivers delivering goods across the UK.’

Buying – and collecting – new cars will be impacted

Many franchised dealer groups announced on Monday that they would be temporary closing showrooms.

Sytner, Marshall Motor Group, HR Owen, Lookers and Chorley Group said they would be closing dealerships hours ahead of the Prime Minster’s announcement that all non-essential businesses – including motor showrooms – should not be opening for trade. 

This means customers can still place orders for cars over the phone, though the appeal of this is very limited. 

Orders already placed will also not be able to be collected due to dealership staff being told to stay home. 

This isn’t good news for the industry, with registrations of new vehicles falling back another 2.4 per cent last year to the lowest output for six years. And there’s been further declines in the first two months of 2020.

Last week, motor dealership group Pendragon slumped to an annual loss of £16.4million in the last year as it struggled to offload ‘excess’ used car stock. 

And the owner of major dealers Evans Halshaw and Stratstone warned that future prospects looked even worse than the sales slump in its rear view mirror.

Online vehicle purchasing site BuyaCa has introduced its own contactless handovers of new cars for vulnerable people, such as the elderly and those with pre-existing health conditions, as the business seeks ways to help consumers and dealers overcome unprecedentedly challenging times.

The business says it is also in the process of boosting stock, with stringent preparation and cleaning processes in place to ensure the safety of customers, who can now buy and even receive a car without stepping out of their home.

It is also waiving its £199 charge for delivery of new motors to key workers – and provide them with a £499 two-year warranty free of charge.

What about buying a second-hand car? 

Used car dealerships are also being forced to close under the guidance of the Government, and with drivers told not to go out and mix with people in their immediate family they don’t live with there should be very limited private transactions taking place. 

This has opened the door for revolutionary online business, Cazoo, which is reporting strong demand for its service in the current climate of consumers staying home and social distancing.

Cazoo holds its own stock of thousands of second-hand vehicles, similar to an Amazon warehouse, and you can purchase entirely on the website or app.

It fully reconditions every motor before offering it for sale and delivers stock for free to customer’s doors in a two-hour delivery slot. 

Every vehicle sold comes with a seven-day money-back guarantee, so you can return it if you’re unhappy with the car, there’s also a free comprehensive 90-day warranty and roadside assistance.

Deliveries are conducted at an extended distance in order to protect both customers and employees during the pandemic, it says.