Diesel drivers are still having to pay “inflated” prices at pumps across the UK on the back of the refusal of fuel retailers to cut pump prices to “fairer” levels.

The RAC says it would take just one major retailer to do the right thing and cut diesel prices to more sensible levels for a ripple effect to take place across the country’s forecourts

RAC Fuel Watch figures also show retailers are currently taking an average margin of nearly 19p for every litre of diesel they sell – double the average 9p in 2021 and 2022 and nearly three times as much as they did at the start of last year (average of 6p) before duty was cut to 52.95p on 23 March 2022.

Both crude oil and wholesale diesel costs are now at their lowest levels in 15 months, but this isn’t being reflected with any “meaningful” cuts in pump prices, according to the RAC.

While wholesale prices have come down another 10p, pump prices had fallen by just 3p a litre at the weekend (168.85p to 165.89p on 19 March).

And while the wholesale cost of petrol and diesel has been narrowing for many weeks and is currently just over 1.5p, the differential at the pumps remains at around 19p a litre.

Analysis last year by the Competition and Markets Authority (CMA) found some evidence of ‘rocket and feather’ pricing – where pump prices shoot up quickly when wholesale prices go up but fall back slowly when they go down – in particular for diesel and a record gap between diesel and petrol prices.

The RAC said the refusal of even a single major retailer to ‘blink’ and cut diesel prices to fairer levels was leaving the country’s 12 million diesel drivers – including van drivers and fleets – forking out more than they should to fill up.

It added that although the chancellor froze duty on petrol and diesel until at least spring 2024 in last Wednesday’s Budget, the 5p duty cut originally implemented in March 2022 “continues to be more than gobbled up by retailers taking so much more margin than they normally do”.

The RAC has now made a plea to retailers to help small businesses by cutting prices – it says large forecourt operators have scope for a “sizeable cut” to diesel pries but also room to reduce petrol prices by a few pence too.

Fuel spokesman Simon Williams said: “In a peculiar way, it feels like it’s retailers who are benefiting from the lower duty cut right now, and not motorists. Drivers and small businesses have every right to feel aggrieved. We’re in a ridiculous situation where it would take just one major retailer to do the right thing and cut diesel prices to more sensible levels for a ripple effect to take place across the country’s forecourts, benefiting hard-up households everywhere. Instead, no retailer wants to blink first, with the result being millions of drivers forking out far more when they fill up than they should.”

In the absence of any moves by major retailers to decide “the time is right to cut the prices to more reasonable levels”, the RAC has urged drivers to shop around and try to find a forecourt that’s charging less than the RAC Fuel Watch average.

RAC Fuel Watch data on diesel pump prices and retailer margins