A fall in the cost of oil and a strengthening of the pound means
retailers should be cutting the price of petrol at the pump.
Data from RAC Fuel Watch shows the wholesale price of unleaded
has tumbled in the last week making it possible for the major
supermarkets to slash at least 2p a litre off the forecourt
price.
The average UK price of petrol stands at 131.23p a litre while
the average price charged at the four big supermarkets is
127.93p. The wholesale price of unleaded has in the last few days
dropped below £1 a litre which means the pump price of petrol at
supermarket forecourts should really be around 125p a litre
accounting for delivery, retailer margin and VAT.
Oil has fallen from a four-year high of $86.23 on 4 October to
$83.85 on 10 October. Meanwhile the pound has improved against
the dollar from $1.29 on 2 October to $1.31 on 10 October.
The price of diesel, however, is not due to come down, although
the rises seen in recent weeks may have come to an end for the
time being. The average price of diesel across the UK is now
136.11p while at the major supermarkets it is more than 3.5p
cheaper at 132.52p. Diesel has risen by nearly 13p a litre this
year while petrol has increased by 10p.
RAC fuel spokesperson Simon Williams said: “Major fuel retailers
should be reacting to the sharp drop in the wholesale price of
petrol by knocking at least 2p a litre off at the pumps.
Motorists have suffered with rising petrol prices for most of
this year with 10p a litre being added since the start of
January.
“We are sure retailers will do the right thing and pass the
savings on to drivers, but the question is how long will it take
for them to do this. As this has come about as a result of a
sudden drop in the wholesale price they can’t yet be accused of
holding off on cutting, but if prices don’t fall soon then we
fear this will be further evidence of the so-called ‘rocket and
feather’ effect where prices go up far more quickly than they
fall.
“The speed with which we have gone from seemingly endless pump
price rises to a sudden moment when they should really be coming
down very clearly demonstrates the volatility of wholesale fuel
and how UK motorists are at the mercy of the international
markets.
“The oil and currency changes have also improved the diesel price
situation, with the constant rises coming to a halt for the time
being.”
