In recent days the pound has suffered its worst exchange rate performance against the US dollar since Lehman’s problems triggered the global financial collapse in 2008.
From a high of over $1.71in mid-August the pound has weakened to below $1.65 and this has held up UK wholesale prices of retail road fuel by nearly 2.00ppl.
Now currency specialists in the city are forecasting that the pound could devalue by at least a further five per cent or more if a ‘YES’ vote succeeds in the Scottish Referendum on 18 September.
This would immediately increase the cost of road fuel by as much as 3.00ppl assuming that the global market for crude oil remains stable. However this is by no means certain given the current geo-political tensions in Ukraine, Syria, Iraq and Libya.
Data shows that total retail fuel volumes in Scotland are 3.1bn/litres/year so any run on the pound caused by the Referendum could cost motorists and businesses north of the border at least an extra £155m a year.
For the rest of the UK the extra cost would approach a massive £1.75bn each year which would be a huge negative drag on the economy and significantly increase inflation.
The road fuel volume split by sector in Scotland reflects the extraordinary and unchecked increase in supermarket forecourt development – up by a staggering 90 per cent since 2000 which compares with 20 per cent for the remainder of the UK.
This is almost certainly the major cause for so many small and often rural independent forecourts closing down their pumps leaving huge swathes of the country without refuelling facilities. This has to be an urgent issue for any Scottish Government to resolve.