In January, the cost of petrol fell below £1 on some supermarket forecourts, as crude oil prices dropped to their lowest level for seven years. This is good news for commuters, transport companies and those business who use petrol as a raw material. We look at the long-term predictions for fuel costs and how much you and your business could save.

In the news, there’s better news about small businesses’ adoption of automatic enrolment and research shows that just 25% of employers offer flexible working.

Top news stories

Small businesses rising to the challenge of automatic enrolment

After some doom and gloom a couple of weeks ago, new figures from NEST suggest that small employers are meeting their duties without issues.

Report says self-employed women disadvantaged for maternity and adoption leave

Self-employed people are not currently entitled to maternity or adoption pay, while state maternity benefits for the self-employed are currently at lower rates.

Flexible working not being offered by employers

Research found that just a quarter of the UK’s workforce has been given the option to work flexibly, despite the Flexible Working Regulations passed in June 2014.

Half of businesses plan to introduce chief IoT role

New research found that businesses will create the role to oversee an average 42% increase in spending on the Internet of Things.

£4,619 is the average debt small firms are chasing in UK courts

The number of county court judgments brought by small and medium-sized enterprises increased by 23 per cent from the first half of 2015 to the second.

Key dates for your diary

7 March: Changes for regulatory references for the finance sector

From this date, banks and insurers will need to follow new rules for employment references for certain senior posts. More details can be found on the FCA website.

Lower fuel prices set to stay?

Apart from oil companies, no one would argue that a drop in the average price of petrol and diesel in the UK is a bad thing. With the UK in the top 15 countries for the cost of fuel, the falling cost of crude and the subsequent drop in petrol and diesel prices has definitely been welcomed.

Dr Ben Broadbent, deputy governor of the Bank of England, said the 75% drop in oil prices has been a “net good” for the economy by helping to push up real-term wages. The cost to fill up a family-sized 55-litre car is now more than £2 cheaper.

And it’s not just individuals who benefit. Businesses who rely on fuel for logistics, distribution or transport should all benefit too, as do the plastics, fertiliser and synthetics industries. But are these lower prices set to stay?

Fuel price predictions

Tax has a significant effect on the cost of fuel - fuel duty is set at 57.95p per litre and there’s another 20% in VAT - which usually makes up about 60% of the total cost. So there is a limit to how far prices could drop. But falling oil prices are still good news, as oversupply often leads to a pressure to pass the price drop on to consumers.

Analysts have predicted a further drop in the price of crude from its current $30 a barrel to possibly as low as $10. That could see the price at the pumps drop to as low as 86p a litre, according to the RAC.

However, fuel duty has been frozen for four years and experts are predicting that the chancellor will increase it in the next Budget. That, combined with issues such as Russian production problems might mean that the costs don’t fall as much as predicted.

Other benefits of lower fuel prices

It’s not just good news for those filling their vehicles or working in industries which rely on petrol. Here are some the other advantages of falling oil prices:

• Lower inflation: this in turn is likely to keep the base rate low.
• Healthier economy: according to PwC, if oil stays at or below $50 a barrel, the UK economy should grow by an extra 1% per year.
• More jobs: in the same document, PwC says that there should be a boost to employment, with 120,000 extra jobs in 2016.
• Increased consumer spending: with more cash in our pockets, we feel better off and are free to spend more, which is good news for B2C companies.

With that in mind, many of us will be crossing our fingers that the cost of petrol and diesel stays low.