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Fuel prices fall back to May levels

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Pump prices have fallen back from record highs to levels last seen in May. But a motoring group said they should be even lower.

The average price of unleaded has fallen to 164.78p per litre (ppl) while diesel stood at 181.28p yesterday, according to the RAC fuel watch.

This is down from the eye-watering costs facing drivers when average petrol came in at 191ppl while diesel stood at 199ppl in June 2022.

RAC fuel spokesman Simon Williams said while this is clearly good news, prices should have fallen much further than they have due to the big reduction in the cost of wholesale fuel this summer.

He said: “The main reason this hasn’t happened is that the big four supermarkets, which dominate UK fuel sales, have refused to pass on savings. They are benefitting from buying cheaper wholesale petrol and diesel.

“This means average margins are now 19p a litre – 12p more than the long-term average. Petrol should really be on sale for 153p a litre and diesel 175p.”

Independents beating supermarkets for fuel

Williams added there’s a “strange situation” where independent retailers which traditionally have been “far more expensive than their supermarket rivals” are often selling at far lower prices.

He said: “Proof of this is the fact that the average price of a litre of unleaded at a supermarket is only a penny lower than the UK average when it used to be around 4p lower.

“We hope the Competition and Markets Authority is watching what’s happening closely.”

In June, at the height of the record prices, Kwasi Kwarteng, the then secretary of state for the Department for Business, Energy & Industrial Strategy (BEIS) wrote to the Competition and Markets Authority calling for an urgent review of the fuel market.

Following its initial review, the CMA decided to initiate a market study into road fuel. At the time, the CMA, said: “If evidence emerges of collusion or similar wrongdoing, we won’t hesitate to take action.”

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