Fuel prices fall for fifth straight month, but diesel still seriously overpriced, says RAC
Fuel prices in the UK continued to decrease for the fifth straight month in March, with petrol prices down by 1p and diesel by 4p, according to data from RAC Fuel Watch.
Since November, petrol prices have dropped nearly 20p, from 166p to 146.5p, saving drivers almost £11 each time they fill a 55-litre family car.
Diesel prices have seen a more significant decrease, falling 27.5p from 190.5p, resulting in a £15 saving per tank.
However, the RAC argues that diesel pump price reductions should have been even greater, as wholesale prices for diesel were similar to petrol throughout March.
Diesel became cheaper than petrol on the wholesale market on 23 March, finishing the month at 111.69p per litre compared to 115.81p for petrol.
While the diesel pump price reduction appears dramatic, the RAC believes it should have been far greater as its wholesale price was very similar to petrol’s for most of March.
In fact, diesel became cheaper than petrol on the wholesale market on 23 March and has stayed that way since, finishing the month at 111.69p a litre compared to petrol at 115.81p.
The RAC calculates that the average retailer margin on a litre of diesel at the end of March was 21p – three times the long-term average of 7p.
In contrast, the margin on petrol was just 7p. The extent to which drivers of diesel vehicles are being taken advantage of is blatantly apparent when comparing the average price charged by retailers in Northern Ireland as it’s 10p cheaper at just 152.78p, the RAC has said.
Petrol is also 2.5p cheaper there – being sold for 143.97p at the end of the month.
Fuel in Northern Ireland is typically cheaper due to factors such as a higher retailer-to-car ratio, more fuel distributors, and sometimes cheaper fuel across the border. It is also worth noting that the big four supermarkets have a smaller market share in fuel retailing in Northern Ireland compared to the UK, at 28% versus 43%.
The average price of unleaded at one of the big four supermarkets fell by 1.5p in March to 143.18p and diesel by 5.3p to 159.88p.
Asda had the cheapest petrol at 142.69p (down 1p) and Tesco had the lowest priced diesel at 159.58p (down 6p).
However, member-only retailer Costco is still offering the most competitively priced fuel across the UK with petrol at 137.7p and diesel at 149.8p.
RAC fuel spokesman Simon Williams said: “The fifth consecutive fall in the price of fuel in as many months is without doubt good news for drivers, but those who run diesel vehicles should have enjoyed far bigger cuts at the pumps than they have actually seen.
“Knowing the average price in Northern Ireland is 10p cheaper at 152.78p is utterly galling for those on this side of the Irish Sea who rely on diesel, whether that’s for personal or business use.
“We hope the Competition and Markets Authority is paying close attention. The situation in Northern Ireland shows just how much diesel should really be being sold for.”
“While there are several reasons why petrol and diesel are generally cheaper in Northern Ireland, it also can’t go unnoticed that the supermarkets aren’t as dominant in fuel retailing there as they are on the mainland.”
“It simply cannot be fair on drivers that the retailer margin on diesel is currently three times more than the long-term average at 21p a litre. While retailers are free to charge what they like for fuel we feel there should be an obligation on the those which sell the most, and therefore buy most frequently, to closely reflect what’s happening on the wholesale market.”
“If this had been the case then the forecourt price of diesel would have been down to around 152p a litre, even with an above-average margin.”
“If a small retailer at Whitchurch in Shropshire can afford to sell both petrol and diesel for just 142.9p a litre, then there’s surely no reason why the big four supermarkets can’t as well.” Spotted something? Got a story? Send a Facebook Message | A direct message on Twitter | Email: News@Deeside.com