Petrol prices set to surge

The price of New York-listed light sweet crude oil soared to 79.29 US dollars (£39.05) a barrel in trading, breaking the previous record of 78.77 US dollars (£38.79) set last month.

A spokesman for the AA said that while the price hike was not yet being felt on the forecourts, the cost of petrol was likely to surge within four to six weeks.

Increases in petrol prices would hit motorists hard, coming at a time of year when fuel usage is traditionally higher, as car headlights are switched on more in autumn and winter, said the AA.

Oil hit the record price on Wednesday on fears over supply, despite oil producer cartel Opec attempting to calm concerns by pledging to boost output by 500,000 barrels a day.

Oil analysts said Opec's move was not enough to meet the strong demand expected over the winter.

The current stock market turmoil, outages at some oil refineries in the US and rising demand for oil from countries such as China has added to the concerns over supply and price increases, according to experts.

AA spokesman Luke Bosdet said: "Traditionally we'd expect to see the cost of petrol coming down this time of year, as we are coming out of the motoring season. But if prices move up dramatically, it will be an unpleasant surprise at a time when fuel consumption is greater as drivers turn on their heaters and lights and use their windscreen wipers more."

Opec, which produces around 40% of the world's oil, will boost supply from November 1.

It is already pumping out around 900,000 more barrels a day over its previous target as global demand for oil has risen sharply.