Drivers overcharged up to 10p per litre of fuel despite largest drop in wholesale prices in four years

Published by Stephen Little on 05 December 2018.
Last updated on 05 December 2018

November saw the biggest drop in fuel prices in four years after fuel retailers finally reacted to falling wholesale costs and dropped prices, the RAC says.

Data from the motoring group the RAC shows that unleaded petrol fell from 130.61p to 125.43p a litre in November while diesel dropped 2.5p from 136.93p to 134.42p.

The RAC says the cost of filling 55 litre family-sized car with petrol was £68.98 – a saving of £2.85 on October. 

Petrol prices are now back to where they were in mid-May, whereas diesel went back to its end of September level.

However, the RAC says that while the oil price plummeted 24% in November retailers have failed to cut costs as much as they should have, with the current average still “unnecessarily high”.

Analysis of wholesale fuel prices shows by the RAC shows that drivers have been overcharged by as much as 10p a litre for unleaded and 7p for diesel.

RAC fuel spokesperson Simon Williams says the average price of petrol should be around 120p a litre.

He says: "While one of the big four supermarkets has consistently cut the price of unleaded the others haven’t by as much which has meant the UK average price didn’t drop as much as it should have done."

The motoring organisation expects average prices to fall even further during December “if retailers play fair”.

Mr Williams says: “Based on our data, petrol still ought to come down by 7p a litre in the next two weeks and diesel by 5p. While this seems unlikely based on retailers’ current track record, we can only hope they are planning some cuts in the run-up to Christmas with a view to getting more shoppers into their stores.”

The average price at the big four supermarkets was 121.27p in November, down from 127.48p in October. The price of diesel fell after four consecutive monthly price rises from 136.88p a litre in October to 130.96p.

The intense competition between supermarkets means they often offer lower fuel prices in the hope that motorists will also do their weekly shop when they go to fill up.

However, in recent months supermarkets have been accused of doing little to lower the price of fuel for drivers.

Mr Williams says: “In the last six years we haven’t seen retailers take this much margin from selling a litre of petrol over such a protracted length of time. Wholesale unleaded began falling from mid-October but retailers were reluctant to reflect this on the forecourt despite the RAC highlighting the issue on numerous occasions."

He adds: “For some time prior to this we had been happy to praise retailers for passing on wholesale savings on the forecourt and say there was little evidence of ‘rocket and feather’ pricing. Now, however, there is very clear proof that many retailers are operating ‘rocket and feather’ policies.”

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So why has the local Tesco

So why has the local Tesco/Mobil petrol station just put up the price by a penny then? Given there’s been no downward movement at any time in the last six months!