Low fuel prices means it’s cheaper to run a car now than it was in 2013
One of a household's biggest bills is being held down by low oil prices.
The average annual cost of running a car is around 22 per cent – or £622 – less than 2013, coming in at £2,197.42.
The decline is due to the price of petrol at the pump, which makes up almost half of the costs of running a car, falling by 37.8 per cent over the period.
Last month motoring group the RAC assured motorists it expects fuel prices to remain in check, despite a recent up-tick in the oil price due to production outages across the world.
Supermarkets slashed petrol prices to below £1 per litre in the run-up to Christmas, citing savings from oil prices which had fallen from over $110 per barrel in the middle of 2014 to around $50.
And it's not only motorists that are benefiting from the low oil price.
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At the end of last week Brent crude, the global benchmark, fell 0.3 per cent to $49.90 per barrel, having broke through the $50 threshold earlier. West Texas Intermediate, the US benchmark, also slumped 0.3 per cent to $49.
Oil cartel Opec’s failure to agree to a production ceiling last week halted a recent rally in the price.
The falling cost of running a car has added to a surge in the number of private hire vehicles on London roads, despite the overall number of drivers falling from 137,000 in 2000 to 64,000 in 2014.
There are now 62,754 private hire vehicles in London, up from 49,854 in 2013, according to the Department for Transport.
US car hire app Uber has over 15,000 drivers in London, and its chief executive Travis Kalanick has said he expects that to rise to 42,000 in 2016.
Last year the Department for Transport released numbers that revealed the total number of licensed taxi and private hire vehicles across England rose to its highest level since these records began in 2005, up by nine per cent over the last two years to 242,000.
The drop in fuel prices is somewhat off set by a rise in insurance premiums, up by 5.2 per cent since 2013. Insurance is the second biggest cost for car owners, accounting for around 28 per cent of the final bill.
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Rising insurance costs mean that 67 per cent of those with car insurance plan to shop around, according to new research from Sainsbury’s Bank.
Ian Hughes, chief executive of Consumer Intelligence, said:
People need to get into the habit more of checking their renewal quotes and always shopping around to see if they can find a better deal.
This is especially true at the moment because the cost of cover has increased during the past few months as the Insurance Premium Tax rise from six per cent to 9.5 per cent in November comes into effect, and another rise to 10 per cent will happen from October.
Meanwhile costs of servicing a car have fallen by 9.7 per cent to £301.60 over the past three years. Tax costs are up by 3.2 per cent to £200, while MOT costs have remained flat.