TAXI drivers said fuel was becoming so expensive they had been forced to invest in hybrid vehicles.

001 Cars in St Aldate’s, Oxford, is investing in a fleet of environmentally friendly Toyota Prius cars which run on a combination of battery and conventional power. They are economical and cost just £10 a year in vehicle excise duty, compared to up to £260.

Yesterday George Osborne confirmed the price of a litre of unleaded petrol was still set to rise by 3.02p from August 1.

001 marketing manager Ricky Audain said raising the income tax personal allowance would be a bonus for taxi drivers.

But he said he didn’t want to pass the price of fuel increases on to the customer.

Mr Audain said: “It is difficult to increase fares as, if we put prices up, we lose custom.

“That is why we are increasing our fleet of hybrids all the time to keep fares down.”