Petrol prices eye £1-a-litre mark

Motorists are bracing themselves for more pain at the pumps with petrol prices set to break through the £1-a-litre mark.

A 2.35p rise in duty, which was delayed from the Budget, is due to come into force on Monday.

The AA said combined with the 1.47p duty hike from December 2006, the October rise alone will mean a typical two-car family will be more than £100 a year worse off.

Meanwhile, oil prices are rising to record levels. Overnight, the commodity extended gains for a third day to above $83 a barrel, nearing its record high.

It comes amid a weak dollar and pre-winter supply worries fuelled fund buying.

Analysts are also concerned that continued robust demand in the US and other consumer nations could tighten up world stockpiles when cold weather hits the northern hemisphere.

OPEC agreed earlier this month to hike oil output by 500,000 barrels per day to soothe fears of a winter crunch, but many traders said the increase was too little.

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