Six ways to beat the petrol price hikes!

With petrol about to hit £5 a gallon, find out how you can beat the price hikes, and even make your car pay for itself!

Figures released by the Office of National Statistics have revealed that inflation (CPI) has risen to 1.5% - the first increase in eight months. And transport seems to be the main culprit for the rise.

Not only have air fares increased, but the prices of second hand cars have increased at the fastest rate on record (1.1% between September and October). And of course, with the news that petrol is due to hit £5 a gallon (110p a litre) by mid December, things are looking bleak for the UK's 30 million motorists.

Indeed, it's reckoned it will cost around £60.50 to fill up the average family car with unleaded fuel, which is a whopping £12.15 more than this time last year. What's more, when VAT goes back up to 17.5% (from the current 15%) on 1 January 2010 you can expect to pay an extra £1.50 on top of that. Ouch!

What's particularly annoying is that while the last time petrol prices were so high crude oil was hitting $100 a barrel, prices in October were between $75 and $80 - so the oil companies are clearly refusing to pass these savings onto us.

But don't let it get you down - here are six ways you can counteract these increases:

1) Reduce those journeys

Sounds obvious, but the best way to reduce the cost of using your car is simply not to use it!

So grab a notebook, and spend a week noting down every car journey you make - where you go (distance), how long you're there and how much you spend on parking.

Now, look at your list (pop it into a spreadsheet if it helps). If you're fit and healthy a trip in the car of a mile or less is downright embarrassing - so prepare to pop your coat on from now on and walk it. It'll save you a fortune in fuel.

If you're making more than two journeys to the supermarket per week you're wasting time as well as fuel, so start making comprehensive shopping lists and cut this down to one, big weekly shop.

Commuting for most of us will form the brunt of our travel, so work out how this can be addressed. If any of your colleagues live in the same town talk to them about car pooling.

Combining trips with just one other person is a fantastic way to save fuel, parking costs and reduce the wear and tear on your car, as well as keep the mileage down. Start sharing with three colleagues and you'll really feel the difference financially - plus it can be a great social activity to boot.

Alternatively, could you investigate cycling to work?

2) Do you need the car?

Conversely, the "car diary" may reveal something you hadn't even thought of - that you really don't do enough miles to warrant having it. This can be the case for many second cars that are there for convenience more than anything else.

Could you cope if you got rid of the car? Over 60s are of course entitled to free bus passes which could make travel very frugal indeed. Are there convenient bus routes you could use, or if you tend to meet friends could you arrange to cover the costs if someone gave you a lift instead?

When compared to the cost of owning a car (paying for tax, MOT, servicing, garage bills and of course fuel) which even for the most economical vehicle still adds up to hundreds each year, paying for a taxi ride or two each week can seem insignificant. Work out the numbers - you may be surprised.

3) Car Clubs

One of the greatest ideas of recent years has been the Car Club.

Essentially a way to have a car at your convenience for anything from an hour to a month, Car Clubs are really taking off and you're bound to find one in your town.

And while at first glance they may not seem amazingly cheap, they cost far less than running your own vehicle - plus you have none of the responsibilities a car owner has. Just make sure the car dropping points are convenient for you.

4) Pay less for fuel

If you must use the car it makes sense to pay as little for fuel as you can. Find out how to cut your fuel costs in six easy steps by reading this goal.

You may also want to consider getting the AA's credit card, which currently offers 0% interest on motoring, fuel and AA product purchases until November 2010, plus you'll earn double points on these items, too.

5) Make money from your car

Finally, if you really want to make your car pay for itself, why not make some money from it?

Nope - I don't mean take on a second job as a delivery driver, there are ways it can earn its keep without really inconveniencing you. And that's by using it as a moving advert.

If you drive your car for more than 500 miles a month there are companies willing to pay you to advertise on it. And the rewards can be surprisingly lucrative, with a side panel earning £240 per year, the rear windscreen and back windows a healthy £900, and if you go the whole hog and use the complete bodywork you could earn £1,500 per year. Not bad!

6) Get help from lovemoney.com

If you need a bit of help cutting the cost of running your car, you've come to the right place.

Adopt this goal: Cut your car costs, and then maybe this one Slash your insurance costs.

And why not have a wander over to Q&A and ask other lovemoney.com members for hints and tips about what worked best for them?

Compare car insurance quotes at lovemoney.com

More: 5 ways to slash the cost of your car insurance | 5 tips when buying a used car