Brown may axe fuel duty rise

The Government's planned 2p-a-litre rise in fuel duty may be scrapped this autumn in an attempt by Gordon Brown to prevent a repeat of the crippling petrol protests of 2000.

The U-turn is being considered by the Treasury as a last resort if world oil markets remain volatile ahead of the scheduled tax increase in September.

The Chancellor today concentrated on pushing for an increase in oil production as Opec countries met in Beirut to discuss plans to boost output by two million barrels a day. But with lorry drivers and farmers threatening a new wave of demonstrations, ministers have also drafted emergency plans to get tough with any bid to blockade oil depots.

Troops and police will be posted immediately to protect refineries, speed limits imposed and train ticket prices cut to cope with any shortages. Unlike four years ago, ministers will act much more quickly to get the army to drive oil tankers. Both Britain and the US hope today's Opec meeting of the world's biggest oil producers will lead to a drop in prices triggered by al Qaeda attacks on Saudi Arabia and rising global demand.

Saudi Arabia, the world's biggest oil producer, announced it was " determined" to drive down prices by increasing production by nearly 11 per cent. Another key Opec member, the United Arab Emirates, also said it would push up production by 400,000 barrels a day.

Oil fell to $39.96 in New York yesterday, a day after frenzied trading saw it hit over $42, or nearly ?25 a barrel. But there are doubts the moves will do much in the short term to reduce prices at Britain's pumps, which have touched ?1 a litre in some parts of London. Government sources today made clear Mr Brown may look again at the tax rises if oil prices remain high. Any lost revenue from scrapping them would be offset by higher North Sea oil income and VAT receipts.