BUSINESS

Supermarkets announce fuel price cuts amid overcharging…


Asda, Morrisons and Sainsbury’s unleash yet another petrol price cut – but motoring groups accuse retailers of overcharging Britain’s drivers

  • Three of the UK’s four largest supermarkets will cut petrol by 1p and diesel by 2p
  • It’s Asda’s seventh fuel price drop in the last three months
  • Yet RAC says drivers are only paying 0.2% less than last year despite oil costs falling dramatically

George Nixon For Thisismoney.co.uk

Three of the UK’s four largest supermarkets are slashing pump prices amid claims that fuel retailers are overcharging motorists.

Asda, Morrisons and Sainsbury’s announced they will reduce the cost of petrol by up to 1p per litre and diesel by up to 2p per litre this week.

It is Asda’s seventh fuel price drop in the past three months, cutting pump prices for a litre of petrol and diesel by 14p and 11p respectively in that time.

Fuel retailers have been accused of not passing on savings to motorists

Fuel retailers have been accused of not passing on savings to motorists

The firm’s national fuel price cap will be £1.14 per litre of petrol and £1.24 per litre of diesel.

Asda and Morrisons will implement the new prices on Tuesday, while Sainsbury’s will make the change on Wednesday.

Asda’s senior fuel buyer, Dave Tyrer said: ‘As a result of wholesale prices recently falling we’ve been able to pass these savings onto our customers, giving them a good start to the New Year.’

But motoring groups have accused forecourts of refusing to fully pass on recent reductions in wholesale costs.

According to the RAC, the cost of Brent Crude – the international benchmark for oil prices – has fallen 20 per cent in a year. As of today, it sits at just over $58 a barrel.

Yet despite this, the group said motorists paid just 0.2 per cent less for petrol than they did last year, while diesel costs 5.3 per cent more than 12 months ago. 

It added that if supermarkets passed on the wholesale savings at the pump, motorists would save an average of 4p per litre.

RAC fuel spokesman Simon Williams said: ‘This cut is very welcome news, but the big question is whether the other supermarkets will respond and drop their prices sufficiently at all of their sites.

‘Drivers badly need the supermarkets to start competing on price again as the so-called price war has been “cold” since the middle of October.

‘If this doesn’t happen then today’s Asda cut will not lower the average price of petrol and diesel across the country by as much as it should.’

Average fuel prices reached a four-year high in October, with petrol at £1.31 per litre and diesel at £1.37 per litre.

By December 2018, average unleaded prices had dropped to almost £1.21 a litre, and diesel to £1.30, according to the latest RAC Fuel Watch.

Supermarkets tend to offer vastly cheaper fuel than other big firms, such as BP, Esso and Shell.  

Last week, a group of MPs called for an independent body to monitor fuel costs.

The All-Party Parliamentary Group for Fair Fuel wants a body – which could be named PumpWatch – to oversee fuel prices in a similar way to the scrutiny faced by utility providers.

Kirstene Hair, the Conservative MP for Angus and chair of the APPG, said last week ‘Drivers need reassurance that they are not paying way over the odds for fuel.’

‘In rural communities where public transport is poor and unreliable, people need their vehicles to get from A to B.

‘It is essential that they pay the fairest price. That is where a price monitoring system would support them.’

However, Brian Madderson, chairman of the Petrol Retailers Association, told the BBC the idea would be ‘impracticable’.

‘Who is going to check prices at 8,500 forecourts?’ he said. ‘And if you have a kitemark, what’s going to be the acceptable margin?

‘If people don’t like high prices, they can go to a cheaper forecourt.’

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