Why fuel prices aren’t dropping at the pumps yet
Fuel prices at the pump remain high, according to the latest monitoring update from the Competition and Markets Authority (CMA).
The watchdog said drivers across the UK have been paying more for petrol and diesel in recent months. While recent rises are partly explained by higher oil prices, the CMA said fuel retailer margins remain far above historic levels.
From the end of May to the end of August 2025, the average cost of petrol rose to 133.9 pence per litre and diesel to 141.9ppl, increases of 1.9ppl and 3.5ppl respectively.
The CMA said supermarket fuel margins stood at an average of 8.4 per cent in the first half of 2025, more than double the 4 per cent average recorded in 2017. Non-supermarket fuel margins averaged 9.8 per cent, compared with 6.4 per cent in 2017.
Dan Turnbull, Senior Director of Markets at the CMA, said: “Our new report shows that drivers across the UK have been paying more at the pump in recent months. While recent price rises are partly explained by an increase in the price of oil, what’s deeply concerning is that fuel margins – a key indicator of retailer profit – remain far above historic levels.
“The Fuel Finder scheme we recommended to government will help combat this trend, pushing retailers to be more competitive as drivers are empowered with real-time pricing data – making shopping around easier than ever. Government aims to launch the scheme by the end of the year.”
The CMA also examined retail spreads, which compare the average pump price with the benchmark wholesale price. Between June and August 2025, petrol and diesel spreads averaged 13.3ppl, well above long-term averages from 2015 to 2019.
The watchdog will publish its first annual road fuel monitoring report at the end of the year. This will include a review of operating costs to assess whether they are influencing fuel margins.
Simon Williams, RAC head of policy, said: “The Competition and Markets Authority’s latest report confirms that retailer margins are far higher than they were historically, and that competition remains weak. Our analysis of pricing data confirms the latter, with just a handful of forecourts appearing to compete heavily on price, with the exception of those in Northern Ireland where drivers enjoy far cheaper fill-ups than in any other corner of the UK. This is no doubt a source of ongoing frustration for many of the nation’s motorists.
“We hope that greater transparency of fuel prices from the end of this year means that a spotlight is shone on both those forecourts that charge the fairest prices and indeed, those that sell petrol and diesel for far higher amounts.
- The CMA’s statutory monitoring role was introduced after its road fuel market study concluded in 2023. It continues to collect data from retailers to track prices and promote competition.
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