How much money will I save from the cut in fuel duty?

Chancellor Rishi Sunak has announced a cut in fuel duty of 5p per litre in his spring statement.

– What has been announced?

Fuel duty will be cut by 5p per litre for petrol and diesel.

– When will the change by implemented?

From 6pm on Wednesday.

– Will pump prices be automatically lowered?

The RAC warned drivers they will only notice a difference once retailers have bought new fuel at the lower rate.

– Will retailers definitely pass on the whole duty cut once they have restocked?

They are under huge pressure to, but there are fears some could boost profit margins instead.

– How much will I save if the cut is passed on in full?

The RAC calculated that would reduce the cost of filling a typical 55-litre family petrol car by around £3.

– When was the last time the rate of duty changed?

– How long will the reduction in duty last?

Until March next year.

– What about VAT?

VAT is added on top, at a rate of 20% of the combined product price and duty.

– What are the latest average pump prices?

The average cost of a litre of petrol at UK forecourts on Tuesday was 167.3p while diesel was 179.7p, figures from data firm Experian Catalist show.

– Why have prices reached record highs?

Oil prices surged immediately after Russia’s invasion of Ukraine due to supply fears, leading to a rise in wholesale costs.

Prices were already increasing as global economies recover from the coronavirus pandemic.