Fuel still too expensive says government watchdog
Mon, 09 Dec 2024
The Competition & Markets Authority (CMA) says that although fuel prices have fallen in recent months, drivers are still paying too much at the pumps for petrol and diesel.
In its latest interim report on fuel price monitoring, it says that the margins fuel retailers are taking remain high by historical standards – both for independents and supermarkets.
Indeed, supermarket margins actually increased between May and August this year, from 7.0% to 8.1%.
The margin remains little changed since the CMA published its initial road fuel market study last summer.
It concluded that "competition in the retail sector for petrol and diesel had weakened since 2019, meaning that drivers were paying more for road fuel at any given level of wholesale prices."
The CMA says that with greater price transparency and shopping around as effectively as possible, drivers of a typical car could save up to £4.50 a tank within a 5-minute drive.
If you compare the margins back in 2019 to those in 2023, drivers paid £1.6 billion more than they should have last year for petrol and diesel.
The average 10p a litre fall in the price of both petrol and diesel in the previous quarter is unlikely to change this.
The CMA is publishing the interim fuel price reports ahead of a new Fuel Finder scheme (also known as ‘pumpwatch’), that it aims to have in place as soon as possible.
The current deadline is to have it in force by the end of 2025. It will oblige every retailer to report their prices to a central database within 30 minutes of a change being made.
This, says the CMA, remains the best way to address the "weakened competition" in the market.
Meanwhile, the RAC says it's disappointing to hear that the CMA is still concerned about competition among fuel retailers and that margins remain higher than historic levels.
"We hope the introduction of the government-backed fuel finder scheme next year will succeed in driving greater competition and enable drivers all around the UK to benefit from fairer prices," says said RAC head of policy Simon Williams.
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