Drivers warned petrol could rise to £1.50 a litre by end of the year

Drivers could be paying almost £1.50 a litre for petrol by the end of this year, a motoring group warned today.

Crude oil price rises could lead to pump prices going up another 20p over the next few months, according to the Institute of Advanced Motorists Trust (IAM).

Its figures showed oil prices have already doubled since July 2007, with the price per barrel now 146 dollars.

If the soaring oil cost continues, petrol will rocket to around 140p per litre and diesel, which is currently around 132p a litre, increasing even higher.

IAM's technical policy head Tim Shallcross said: 'If crude oil prices stay at their current level, or rise even higher, Britain's motorists can expect another 20p rise in the price of a litre before the end of 2008, bringing closer the prospect of the 150p litre.'

The organisation's research lays bare the huge rise in fuel costs over the past 12 months.

This time last year, unleaded petrol was 97p a litre and diesel was 97.4p. Crude oil was just over 71 dollars a barrel.

Now crude oil is trading at double that price, which is having a disastrous effect on the pumps.

Petrol prices are currently at 119.37p - a rise of 19 per cent - while diesel has hit 132.78.

Tax on fuel is split between VAT and a fixed amount of duty, so a comparison of the pre-tax prices is needed to show how much the basic price of the fuel has gone up over the past year and whether we have seen the real impact of the record high crude oil prices.

The pre-tax price of a litre of petrol in July 2007 was 34.2p and for diesel it was 34.5p.

If these had doubled in 2008 to match crude oil prices, the pre-tax price would be 68.4p for a litre of petrol and 69p for diesel.

Applying today's higher duty of 50.35p, and adding VAT, gives a pump price of 139.53p for petrol and 140.24p for diesel.

If crude oil prices stabilise at today's levels, or rise even higher, pump prices will inevitably catch up.