[holding answer 29 February 2008]: The Department for Transport uses oil price projections from the Department for Business, Enterprise and Regulatory Reform (BERR) to produce a fuel price forecast. This is then used in the Department’s National Transport Model (NTM) for forecasting congestion on the road network. Their latest projections are for oil (in 2006 prices) to fall gradually to $50 by 2015 before then rising to $52.5 in 2020 (approximately $75 in nominal prices).
BERR also produce a high and low projection around this central price which we have also used in our forecasts. These are for prices of $25 and $80 (about $115 nominal) in 2020. The Department forecasts congestion in different scenarios including ones where high prices are assumed. This is to check the robustness of estimates were high oil prices, such as those observed currently in crude oil markets, to continue.
BERR are currently revising their oil price projections in light of a consultation on them that has recently ended. We will use this revised information to determine new traffic and congestion forecasts.