Motoring news - Even drivers with low mileage car insurance won’t save on fuel

low mileage insurance news - Car owners likely to pay more for diesel

Rising insurance prices are leading many motorists to opt for low-mileage car insurance which offers cheaper car insurance quotes to those who do not drive long distances frequently. However, a predicted fuel price increase is likely to affect all drivers, regardless of which type of car insurance they have.

According to reports, wholesale costs for diesel rose by 4.5p per litre between December 19 and January 5. It is thought that Iran's threat of a blockage in the Straits of Hormuz and shutdowns at refineries have acted as factors in the price escalation.

RMI Petrol, the organisation which released the figures, has claimed that forecourt retailers are likely to pass on these wholesale increases which could cause the cost of diesel to rise above peak prices from last year – diesel reached 143p per litre in March 2010.

Brian Madderson, RMI Petrol chairman said, "I would expect [fuel forecourt retailers] reluctantly to push these rises through.

"That's more pain for the consumer and for high-street retailers, who are already squealing that people are not spending in the shops because of the high cost of fuel. Higher diesel prices also feed into food prices because 80% of our food moves by road."

Mr Madderson will reportedly discuss the rising cost of fuel tax with Danny Alexander, chief secretary to the Treasury, later on in January amid concerns that the increases are predominantly effecting less well-off motorists.

If you would like to find out more information about low-mileage car insurance from insurethebox, click here.