Petrol stations have been instructed to quickly transfer fuel cost savings to the many motorists who have been facing escalating expenses at the pump due to the surge in oil prices resulting from the Middle East conflict. Despite a decrease in oil prices from over $112 per barrel, concerns linger that drivers have not yet fully benefited from the drop.
The Competition and Markets Authority, in its recent market assessment, has not found evidence of retailers changing pricing strategies to capitalize on the crisis. The analysis indicates that the bulk of the pump price increases in March and April can be attributed to elevated wholesale prices.
However, the CMA also noted that fuel retailers are maintaining historically high profit margins, with some even seeing slight increases in April. The regulator is advising drivers to utilize the fuel finder tool to identify the lowest prices at nearby pumps, potentially saving an average of £9 per tank.
Sarah Cardell, CEO of the CMA, expressed concern over the financial strain on drivers caused by high pump prices, emphasizing the need for fair competition in the sector to prevent overcharging. She urged retailers to promptly pass on any reductions in wholesale prices to consumers.
Oil prices climbed following Israel’s military action in Lebanon, raising fears of disruptions that could impact the fragile truce between the US and Iran. Despite these geopolitical tensions, petrol prices hit a high of 159.53p per liter last week, significantly above pre-conflict levels. Diesel prices have slightly decreased since peaking in mid-April.
With oil prices hovering below $100 per barrel for nearly a week, there is anticipation for potential reductions in forecourt prices. The RAC encourages motorists to leverage tools like the myRAC app to secure the best fuel prices available.
Luke Bosdet from the AA highlighted the need for scrutiny of pricing practices at petrol stations, emphasizing the importance of investigating retailers’ profit margins amidst the ongoing price fluctuations in the fuel market.
