The average price of unleaded petrol has now changed
Motorists are poised for some much-needed respite at the forecourt this week as fuel prices undergo changes.
The average cost of unleaded petrol has now declined to 151.98p per litre, while diesel has dropped to 168.64p per litre, according to the most recent RAC Fuel Watch data. However, the RAC maintains that retailers ought to be reducing prices even more substantially, contending that drivers are still being overcharged despite wholesale fuel costs plummeting.
RAC head of policy Simon Williams said: “Fuel prices are falling steadily in reaction to the drop in the price of oil and wholesale petrol and diesel costs which is good news for drivers who’ve had a torrid time at the pumps this year. But our analysis of wholesale data shows the reduction should be faster and greater, particularly for diesel.”
He continued: “The average price of petrol has come down 2p in the last week to 151.98p and diesel by 4p to 168.64p. Since unleaded hit an Iran war high of 159.53p on 28 May it’s fallen by almost 8p whereas diesel is down 23p from its peak of 191.54p on 15 April.”
Mr Williams indicated that drivers should shortly be witnessing average petrol prices dipping below 150p per litre and diesel below 160p per litre if retailers completely pass on reduced wholesale costs.
He said: “Drivers really ought to see average prices of below 150p for unleaded and below 160p for diesel in the next week or so.”
Even accounting for the recent price reductions, filling a typical 55-litre family car still costs £83.59 for petrol and £92.75 for diesel. That remains £10.50 more for petrol and £14.40 more for diesel than before the Iran conflict sent oil prices soaring at the end of February. The renewed calls for lower forecourt prices come as the global oil market has cooled considerably.
Brent crude was trading at around $73 a barrel on Monday morning, a far cry from the levels reached at the peak of the Middle East conflict, after fears over supplies through the Strait of Hormuz began to ease. Oil prices have now fallen back to roughly where they stood before the latest surge in geopolitical tensions.
The declining oil price has once again raised questions over how swiftly fuel retailers pass on savings to motorists.
It emerged last week that the sharp drop in crude oil prices had not yet been fully reflected at Britain’s petrol stations, despite wholesale fuel costs falling steeply. The RAC noted that pump prices typically trail movements in oil markets, but argued that retailers ought to be cutting prices more rapidly.
The matter is also under close scrutiny from the UK’s competition watchdog. Earlier this year, the Competition and Markets Authority put fuel retailers on notice over potential profiteering during the oil price spike, and has continued to keep a close eye on whether wholesale savings are being passed on fairly to drivers.
The regulator has cautioned that it is seeking proof of the so-called “rocket and feather” effect, whereby prices shoot up swiftly when oil grows more costly but drop far more gradually when those costs begin to decline.
