Motorists are facing more pain on the forecourt as oil prices climbed back towards 100 US dollars a barrel.

The price of light, sweet crude for March delivery rose by more than two dollars to hit 98.55 dollars a barrel, following a three per cent rise last week.

Motoring organisation the AA yesterday said the rises could spell further gloom for drivers, who on Monday saw average unleaded petrol prices in the UK climb back above the 104 pence a litre mark. The average cost of diesel was also nearing the 110p a litre mark.

The AA had been expecting prices to stabilise after previous falls in oil prices caused average unleaded prices to drop around 0.5p a litre from the record high of 104.44p seen on January 23.

But AA spokesman Luke Bosdet said: "The price of petrol is beginning to rise again. We are not quite at the records we were seeing at the turn of the year, but it doesn't look good."

The price of oil futures is now about nine dollars higher than the closing price on February 6.

With the International Energy Agency forecasting reduced global demand, industry analysts had expected prices to respond with a steady fall.

A seasonal price dip also tends to occur in the first quarter of the year as less driving during the winter months reduces demand. According to experts, the main worry is that production could be cut by members of the Organisation of Exporting Producing Countries just ahead of spring.

Reports in recent days have also suggested that global economic conditions may not be deteriorating as quickly as thought. The US Federal Reserve said on Friday that industrial production in the world's largest economy rose last month.

Early last month the price reached an all-time high of just above 100 dollars a barrel.

Energy market publication the Schork Report, edited by energy analyst Stephen Schork, said: "Energy prices are strong. The path to 100 US dollars... appears open.

* Beer could hit an average £4 per pint at pubs in the capital this year as brewers face rising production costs, a trade body warned yesterday.

The British Beer and Pub Association said the £4 pint would also start making inroads elsewhere in the UK.

This is mainly due to the soaring wholesale costs of grain, energy and petrol making production more expensive, the group said.

BBPA director of communications Mark Hastings warned: "The average price in London is now round about £3.80.

"What we are saying is that in the course of this year there will be a series of rises which will take prices above £4."