RAC calls on biggest retailers to cut price of petrol as wholesale costs dip

Following a dramatic dip in the wholesale price of petrol in the last few days the RAC is calling on fuel retailers to play fair with drivers and cut prices at the pumps.

RAC Fuel Watch data* shows the average price of unleaded is 6p a litre too expensive. Despite the recent wholesale price reductions, the price of petrol on forecourts has continued to go up – rising 3p a litre since the start of the month – and now stands at 147.27p. However, the RAC believes the average price should be nearer 141p a litre which means drivers are having to unfairly fork out an extra £3.50 a tank.

RAC fuel spokesman Simon Williams said: “In the last few days the wholesale price of petrol has fallen steeply which means the biggest retailers are in a great position to cut prices and ease the burden being felt by drivers throughout the UK who are paying £80 for a full 55-litre tank.

“As the big four supermarkets are responsible for selling 45% of all the country’s fuel, they are constantly buying new supply so they’re able to pass on the savings to customers straightaway unlike smaller retailers who tend only to buy in fuel once a fortnight.

“The longer they hold off doing the right thing, the more money they make on every litre they sell and the worse off drivers are. Unfortunately, during Covid we’ve seen retailers increase their margins by 2p a litre from the norm of 5p to 7p. However, the recent downward wholesale movement means they’re now taking averaging more than 10p a litre.

“This seems very harsh on drivers considering how many are struggling financially because of the inflated cost of filling up. RAC research has found that around half of drivers (46%) will be forced to cut other household spending as a result of petrol and diesel prices continuing to rise beyond their current record high levels.

“Unfortunately, the biggest retailers appear to have failed the transparency test as they are continuing to move prices up when they should now be doing the opposite just because there’s public acceptance that energy prices are rising. This isn’t acceptable but sadly consumers have no power to object. It’s also the case that no one is watching fuel prices as closely as the RAC which is why we’re highlighting the issue today.”

The price of diesel should also be reduced. Now standing at an average of 150.66p, the downward trend in the wholesale price means at least 4p a litre should be shaved off the forecourt price, taking it to 146p a litre.

Simon Williams added: “While we’ve seen reductions in the cost of pure wholesale petrol and diesel, there’s also been a big reduction in the wholesale cost of their bio components which is significant because both now contain up to 10%. This alone should lead to a 2p a litre reduction in the price drivers pay at the pumps.”

Find out more about UK petrol and diesel prices on the RAC website.