Trade braced

for oil price

backlash

Licensees could be hit with higher than average increases in beer prices if the recent surge in petrol costs continues.

Petrol prices have shot up in recent weeks, largely as a result of rising oil prices due to the continuing instability in the Middle East.

The cost of a barrel of Brent Crude oil hit a record $70 late last week, and petrol prices at the pumps have topped 90p a litre.

Major drinks firms have signalled that the petrol price hikes, coupled with a recent surge in utility costs, could force them to add the costs onto licensees when they unveil their new price structures early next year.

A Carlsberg UK spokeswoman said: 'As with all UK manufacturers, Carlsberg UK is experiencing significant rises in fuel and utility costs.

'There are no immediate plans to increase beer prices, however, Carlsberg UK's ability to continue to absorb cost increases of this scale is limited, she said.

'Should these pressures continue in the medium term, it will become necessary to recover these additional costs.

Britain's biggest brewer Scottish Courage spokesman Nigel Pollard said ScotCo has 'no plans at the present time to change prices. But he added: 'We will have to look at fuel costs when we do that examination in spring 2006.

Paul Hegarty, spokesman for Coors Brewers, gave a similar response. 'In the short term we wouldn't put up our prices as a result of (petrol price increases), but there's continuous pressure from both pubs and producers from a range of areas, he said.