Motorists saw the average price of unleaded fall to 117.54p per litre at the end of March - down from 120.15p – while diesel dropped from 122.19p per litre to 119.54p over the same period.
This means an average 55-litre family petrol car now costs £64.65 to fill up, with diesel slightly higher at £65.75.
The RAC Fuel Watch, which compiles the price data, puts the drop in costs down to the biggest fall in the price of a barrel of oil since last July – it fell from $55.31 on 1 March to $52.30 on 30 March.
RAC fuel spokesperson Simon Williams says: “March brought some much-needed spring cheer to motorists with a significant 2.5p a litre reduction in the average price at the pumps. While prices were static in February, the two months before that saw 5p a litre added, completing a year of rising average pump prices. March saw the biggest fall in the price of diesel since January 2016 and since November last year for petrol.
“Going forward, everything really hinges on the oil market and whether more is done to curb supply with a view to getting the price to rise. The Organization of the Petroleum Exporting Countries (OPEC), together with some non-members, has cut production, but its efforts have been undermined by the US ramping up its fracking production.
“The strength of the pound against the dollar is also important as fuel, like oil, is traded in dollars, but having suffered a big drop in the value of the pound after the Brexit vote the new norm seems to be a pound that is consistently worth $1.24. The absence of any further significant downward movement should mean fuel prices will be mostly decided by the oil market.”
Biggest price drop in Scotland, while South East is still the most expensive
Scotland saw the biggest drop in the price of both petrol and diesel over March, with a fall of 2.9p a litre across the board, ahead of the UK average of 2.6p.
The North East has – for the second consecutive month – recorded the cheapest petrol and diesel prices in the UK with unleaded at an average of 116.50p and diesel at 118.53p at the end of March. At the other end of the scale, the South East continues to sell the most expensive fuel, with a litre of petrol costing 118.38p and diesel costing 120.30p.