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Fuel retailers failing to pass on price drops

Fuel retailers failing to pass on price drops
Emma Lunn
Written By:
Posted:
30/06/2025
Updated:
30/06/2025

The Competition and Markets Authority (CMA) found that drivers are paying more than they should be for fuel because margins have remained high despite lower fuel prices.

Publishing its latest monitoring report, the watchdog set out observations on developments in the UK’s road fuel retail market since its previous update in March 2025.

A retailer’s fuel margin is the difference between what it pays for fuel and what it sells it at. The CMA found that fuel margins were similar to the high levels seen during its road fuel market study in 2023, which suggests overall competition in the UK’s road fuel retail market remains weak.

Fuel prices across the UK decreased for both petrol and diesel from the end of February 2025 to the end of May 2025.

The average petrol and diesel prices at the end of May 2025 were 132 and 138.4 pence per litre (ppl) respectively. This represents decreases of 7.6ppl and 8.4ppl in petrol and diesel prices compared to the end of February 2025.

Supermarket fuel margins fell from 8.9% in December 2024 to 7.9% in February 2025, before rising to 8.3% in March 2025. Non-supermarket fuel margins fell from 9.9% in December 2024 to 8.9% in January 2025, before rising to 10.4% in March 2025.

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Dan Turnbull, senior director of markets at the CMA, said: “While there is uncertainty over how global events will impact the price of oil, our report shows fuel margins remain high compared to historic[al] levels despite lower prices at the pump in recent months.

“The Government committed to launching a ‘fuel finder’ scheme following our recommendation to help drivers compare real time prices and boost competition. Once launched, it will make it easier than ever to shop around and find the best deals.”

The ‘fuel finder’ scheme will allow drivers to compare real-time fuel prices, via navigation apps, in-car devices and comparison websites. The Government’s aim is to launch the scheme by the end of this year, subject to legislation and parliamentary time.