Fuel bills drive up motoring cost

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Higher fuel prices mean the cost of keeping a car on the road rose by 7.2% in the past year, research suggests.

Sainsbury's Bank said the average cost of running a car for a year rose to £2,202 in August from £2,053 last year.

Rising fuel costs were behind the bulk of the increase, climbing 11% compared with 2005 to £1,226, driven by record crude oil prices.

Other costs drivers faced included £462 for insurance, £273 for servicing, £116 for tax and £44 for MOT.

Sainsbury's also said that drivers who shy away from haggling over the cost of a new car could be throwing away as much as £1,200.

'Shop around'

"The cost of motoring has been rising steadily but you can keep this in check," said Richard Clark, car insurance manager at Sainsbury's Bank.

"For example, shopping around for car insurance and your fuel could make a real difference to your motoring bill at the end of the year."

According to fuel price checkers Catalist, the average cost of a litre of unleaded petrol is now 93.64 pence while diesel is 96.45p.

However, supermarkets Asda, Tesco and Sainsbury's recently cut their prices to between 91p and 93p.

Prices neared the £1-a-litre mark recently as crude prices rose above $78 a barrel in August amid concerns over increasing instability and threats to oil supplies from the Middle East.

Motor insurance premiums have also been in the news after insurer Norwich Union said it would be increasing premiums by an average of 16% - and as much as 40% for riskier customers such as young men.

The firm argued that the increases were needed to cover the cost of rising personal injury claims.

Industry experts predict most firms will follow suit in coming months.