Petrol and diesel prices have risen by 10p a litre since the start of 2024 – typically adding £5.50 to the cost of a tank of fuel.
That’s according to the RAC, which said the cost of unleaded petrol and diesel increased by 3p and 2p per litre respectively in April. The breakdown organisation also said filling a typical petrol car with a 55-litre tank now costs £82.47. The cost for a similar diesel vehicle is £86.77.
The lowest prices for petrol and diesel in 2024 so far were both recorded on 16 January.
Calling for government intervention
The RAC claims the increase in fuel prices at the pump is ‘weighing heavily on household budgets’ and it called on the Competition and Markets Authority (CMA) to help motorists save money.
According to the RAC, fuel retailers have ‘unfair margins’ that ‘lead to drivers getting a raw deal’. The CMA estimates that UK drivers were effectively overcharged by around £900 million in 2022.
Diesel profit margins increased by 6p last month to 18p per litre, says the RAC, while the average margin now stands at 9.5p per litre.
Responding to this claim, Gordon Balmer, executive director of the Petrol Retailers Association, said fuel stations are “operating on razor-thin margins” and are doing “all they can to keep prices low for their customers”.
RAC versus the fuel industry
Taking aim at the RAC, Balmer added: “It is disappointing that we are constantly having to devote time and resources to correcting the inaccurate narrative offered by some commentators about pump price increases. We are doing all we can through the appropriate policy channels to address this issue, while others would prefer to offer criticism without taking the time to understand how the industry works.”
If the CMA and government were to intervene as requested, the RAC says fuel prices across the UK mainland could come down to match those charged in Northern Ireland, which are ‘consistently 5p a litre (£2.50 a tank) lower’. It also blamed higher diesel prices on retailers using larger margins to subsidise the cost of unleaded.
“It is very apparent that retailers are making massive margins on diesel. To put this into perspective, the wholesale price of diesel has been lower than petrol since the middle of April, yet diesel is nearly 8p a litre dearer at the pump,” said RAC fuel spokesperson, Simon Williams. “If retailers were treating drivers fairly, this gap would be starting to close instead of getting wider.”
The CMA declined to comment when approached by Motoring Research. However, in late March it issued a report stating that high fuel margins are ‘concerning’ for motorists and ‘indicated weakened competition.’
“We’ve been clear that retailers must pass fuel savings to drivers – and that’s why we are making sure there is no place to hide for anyone found to be unfairly hiking up their pump prices,” a Department for Energy Security and Net Zero spokesperson told us.
“Our new Pumpwatch scheme will help drivers find the best deal at the pump, by making real-time price sharing mandatory. We’re also taking action to bring competition back to the forecourts with new powers for the CMA to shine a light on any attempt to overcharge UK drivers.”
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