Blame supermarkets for high petrol prices, says RAC
The RAC has wiped out the ‘big four’ supermarkets for failing to lower fuel prices last month, which has helped fuel pump prices remain higher than they should be.
It said the average price of petrol and diesel had fallen by 6p a liter in November, but cuts at the country’s filling stations should have been at least double that.
With the wholesale price of both fuels falling, petrol and diesel should have been 14p and 15p-a-litre lower than what they currently cost.
It said the failure of Asda, Morrisons, Tesco and Sainsbury’s to lower their pump prices has led to profit margins of more than 20 pence for each litre, which the motoring group described as a ‘scandal’.
“Blame the supermarkets!” The RAC has accused the big four of not fully passing on the savings of cheaper wholesale petrol and diesel, keeping average pump prices in the UK ‘artificially high’. Motoring Group says petrol and diesel should be 14p and 15p a liter cheaper than they are now
Unleaded fell from 165.96p at the start of November to end the month at 159.88p, while diesel fell from 190.31p to 183.87p, the RAC said.
This saved motorists more than £3 per tank by the end of the month, it adds.
But the driver should have saved a lot more money at the pumps, says the automotive group.
It says drivers lost out when the wholesale price of both fuels plummeted in November, but retailers failed to pass on these savings.
Wholesale petrol fell 11 pence from 122.63 pence to 111.53 pence and diesel fell even more, falling 15 pence from 143 pence to 128 pence.
Taking the average of wholesale prices for the last week of November, the RAC believes that petrol should really average 146 pence and diesel 169 pence – 14 pence and 15 pence lower than current averages.
As a result, it believes that retailers are now collectively benefiting from margins of more than 20 pence on every liter pumped into vehicles – a figure that the RAC says drivers ‘will find really shocking if they struggle to put fuel in their car to to live their daily lives’.
Unleaded fell from 165.96 pence in early November to end the month at 159.88 pence, while diesel fell from 190.31 pence to 183.87 pence, the RAC said.
The automotive organization pointed the finger at the four major supermarkets for not implementing price reductions across the sector.
A liter of unleaded lead bought from a supermarket cost 158.31 pence in November – a drop of 6 pence in the month – which is only 1.6 pence lower than the UK average.
Supermarket diesel fell 3.7 pence to 182.74 pence at the end of November, just a penny below the average price nationwide.
Historical data from the RAC data shows that both fuels are typically 3.5 pence cheaper when bought in a supermarket.
RAC fuel price spokesman Simon Williams says that is sadly not the case this year, with major supermarkets accused of ‘holding onto huge margins for life’
RAC fuel spokesman Simon Williams said: ‘It borders on a scandal that drivers are being overcharged by so much because the four major supermarkets, which dominate the UK’s fuel retail trade, flatly refuse to lower their prices by any larger amount.
‘Their prices are falling like a feather when they should be falling like a brick.
“In 10 years of keeping a close eye on fuel prices, we’ve never seen major retailers’ margins this high for so long.”
Before the pandemic, supermarkets – particularly Asda – would compete to announce a price cut due to falling wholesale prices, in an effort to attract more customers to their stores.
‘This sadly seems to be a thing of the past as these days they seem to be holding on to huge margins for a lifetime,’ added Mr Williams.
“This is to everyone’s disadvantage as other retailers are obviously not encouraged to lower their prices, leaving the UK average artificially high.
“We have more sympathy for smaller retailers who don’t buy new stock as often as their larger competitors and who need bigger margins to stay afloat – to their credit, some have slashed their prices, vastly undercutting the supermarkets.” .
“We have had reports of independent retailers selling petrol for as little as 140p a litre, which is 18p less than the supermarket average.”
December is traditionally a month when the big four announce pump cuts to benefit drivers traveling over the Christmas period – and to boost shop visits as families stock up for the holidays.
Yet there is still no news from any of the major supermarkets about reduced fuel prices this month.
While every retailer is free to charge what they want for their fuel, it doesn’t seem fair that some of the biggest retailers seem to be taking advantage of their struggling customers in the run-up to Christmas by earning more than 10 pence more. on a liter than before.
“We urge every motorist not to automatically assume that the local supermarket is the cheapest place to fill up and shop for the best priced fuel.
“We saw similar behavior with fuel prices from the major chains last Christmas, but we still think this is probably the worst example of rocket and feather pricing we’ve ever seen.”
The RAC provided details of how much fuel prices fell in each region in November
The RAC says it wants the Competition and Markets Authority to pay particular attention to current prices as part of its ongoing investigation into UK fuel retailing.
“We would also like to remind supermarkets that the government’s 5 pence per liter excise tax cut is still in place and is intended to ease the burden on drivers,” says Williams.
The average price of a liter of diesel at the end of November was 24 pence more expensive than unleaded diesel as the gap between the fuels widens due to higher demand for diesel on the continent.
Blocking Russian oil exports during the war in Ukraine is driving fuel costs even higher, as many European countries increasingly use diesel for heating and power generation, increasing demand.
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