Should we prepare for an oil price crash?

I almost felt a sense of perverse celebration as the meter clocked round to £100 – the first time I have ever spent so large a sum filling my car with diesel. Not so long ago it was costing me closer to £60. After gas and electricity prices, it is suddenly oil prices which are making the news. Some garages have been shown selling the fuel for over £2 a litre. If you live in a rural area and rely on oil to heat your home, you may have experienced an even bigger shock in the past fortnight: the price of domestic heating oil has doubled to around 120 pence a litre – the percentage change is greater than for road fuel because a much lower proportion of the price of a litre of heating oil is tax.

The surge in petrol and heating prices has added to an already inflationary environment, with some now expecting the Consumer Prices Index to top out at over ten per cent at some point this year.