The RAC has called on the UK’s major retailers to cut fuel prices by 5p a litre as it warns that drivers continue to be “ripped off” at the pumps.

RAC Fuel Watch data shows retailer margins on petrol are up across the board

Its data reveals the delivered wholesale price of petrol averaged just over 113p last week which, alongside a UK average price of unleaded of 155.33p, means that average retailer margin was more than 16p a litre before VAT is applied and 14p a litre for the supermarkets.

This is in stark contrast to the long-term average of 7p a litre and is even far higher the 10p margin that smaller, independent retailers argue is now fair due to inflation

The RAC also warns that diesel, which is currently averaging 162p across the country, is “overpriced” by around 4p a litre. Last week, a litre of wholesale diesel averaged 123p meaning average retailer margin is around 12p, compared to the 8p long-term figure tracked by the RAC since 2012.

It’s now warning that the Government’s 5p duty cut brought in shortly after Russia’s invasion of Ukraine last year is not benefiting drivers struggling to cope with the cost-of-living crisis and “instead appears only to be helping retailers who have chosen to up their margins”.

That’s despite an investigation by the Competition and Markets Authority (CMA), which concluded in the summer and found that the big four supermarkets had overcharged by 6p a litre in 2022, costing drivers around £900m.

The report recommended retailers be required to provide real-time pump prices by site and that a price monitoring body be created – both of which the Government has pledged to legislate for. But while many larger retailers have started issuing live pricing data, there is still no news on when a pump price watchdog may be set up – and the RAC now says it fears “history is repeating itself when it comes to big retailers charging far more for each litre of fuel than they need to”.

Fuel spokesman Simon Williams said: “Drivers and, indeed, the Treasury should be furious that the 5p-a-litre duty cut, which has been in place since the end of March 2022, is not being passed on at forecourts. There is no doubt from studying RAC Fuel Watch data that margins are up across the board, and while retailers argue their costs have increased due to inflation, the irony remains that there is a definite link between pump prices and consumer price inflation.

“A failure to cut pump prices to fairer levels when there is a clear opportunity to do so has the effect of keeping inflation artificially high – which is clearly in nobody’s interest.”

It’s now calling on the Government to set up the price monitoring body recommended by the CMA and for it to carry powers to take action against big retailers “that don’t reflect downward movements in the wholesale market such as we’ve been experiencing in the last six weeks”.

The RAC is also urging the big four supermarkets, which sell around half of all the fuel bought by drivers, to explain “their steadfast refusal to cut prices to fairer levels”.

But Williams added: “Sadly, we know this is highly unlikely to happen and instead, at best, we’ll get another banal statement from the British Retail Consortium while independent retailers will feel the need to defend themselves, despite us recognising that this isn’t a problem of their making.”