Fuel prices fall but drivers still paying over the odds
Both petrol and diesel reduced by over a penny a litre in January, marking three consecutive months of falling fuel prices – but the RAC says prices should drop further if retailers pass on savings in wholesale costs.
The data for last month from RAC Fuel Watch shows the UK average price of unleaded dropped by 1.32p to 120.92p while diesel dropped 1.27p to 130.01p. And at the country’s four biggest supermarkets, prices are an average of 3p a litre lower at 116.66p for petrol and 125.43p for diesel. At motorway service areas, however, a litre of unleaded sets drivers back 138.87p and diesel 147.55p.
However, looking at the wholesale prices shows further cuts could be made to ensure fair prices. Although the RAC figures show the wholesale price of petrol stayed flat in January while diesel increased by 2p a litre, the organisation says that when compared to retail prices they were low still low enough to demand pump price reductions during the month. If retailers were to pass on existing savings in their wholesale costs the price of petrol ought to reduce by 3p a litre in the next two weeks, and diesel by 2p a litre.
RAC fuel spokesperson Simon Williams said: “The wholesale fuel market operates very transparently, but the same can’t be said of the retail market. We understand retailers are free to charge what they like for their fuel and that it’s then up to consumers whether they’re prepared to pay their prices or not. Unfortunately, consumers don’t have an easy way of knowing whether they are being charged a fair price so they have to trust they aren’t being ripped off. That’s why we always encourage drivers to check the current average price of petrol and diesel, and see if they can beat that price when paying for fuel locally.
“Combine this with the fact some bigger retailers vary their prices from location to location, fuel is an essential purchase for most people and that shopping around is not that easy, and you have the perfect recipe for drivers being charged over the odds for what is essentially a commodity.”