SOARING oil prices are threatening the future of rural bus services in Lancashire, transport bosses have admitted.

Lancashire County Council has already axed or reduced subsidy to five bus routes so far this year while another five are now under review.

And the county's transport chief today admitted more routes could go to the wall if prices continued to rise.

Natural disasters including Hurricane Katrina, which hit America, and man-made problems such as the war in Iraq have driven up oil prices.

Dozens of bus services are subsidised by the council. Now bus companies are asking for more money because of their rising costs.

County Councillor Tony Martin, in charge of sustainable development at Lancashire County Council, said: "We aren't obliged to subsidise any service but we spend millions a year doing that and could spend three times what we do.

"But the cost of oil is making it difficult for us at the moment. I was told it would never go higher than $55 but it has topped $65 as a result of recent natural disasters.

"That means bus companies want higher subsidies to keep unprofitable services going and there is only so far our money will stretch.

"It means we have to prioritise which services we support. That means as more contracts come up for renewal, some won't be renewed.

"Our concern is that the people who will suffer most are those in rural areas."

He added that the authority had already had to start cutting back services as they came up for review.

Last month, Lancashire County Council also confirmed the office at the Clitheroe rail/bus interchange would having its opening hours reduced to save money.

Both Blackburn Transport and Lancashire United, two of the main bus operators in the area, have increased their fares in recent months, blaming oil prices.