Supermarket giants kick off diesel fuel price war
Morrisons was the first to announce it will be cutting the price of a litre of diesel by 2p. Rivals Tesco, Sainsburys and Asda have also made similar pledges.
All the supermarkets point to a drop in wholesale prices of diesel as the trigger for the price decrease.
The AA said last week that the take-up of diesel cars has seen overall sales of petrol at the forecourt drop 3.5% as soaring pump prices continue to take a toll on UK motorists.
Despite the latest price drops, motoring groups are questioning whether the reductions will be in areas where people will benefit the most.
Paul Watters from the AA told Your Money: “Although the reduction in the price of diesel is very welcome, the question is to what extent this is reflected in rural areas where it is essential for country business and activities.
“There is traditionally a springtime fall in the cost of diesel as the demand for heating oil, which comes from the same part of the oil barrel, drops off.
“A strengthening pound has also helped – a factor that has also pushed down the cost of petrol. If last week’s falls in petrol wholesale prices persist, a 1p drop in the pump price is on the cards. As it is, previous petrol cost reductions were passed on fully by some supermarkets but not others.
“Consequently, the average UK price of petrol is down only 2p a litre whereas the more fortunate towns have seen a 4p fall. Such is the enduring UK petrol price postcode lottery.”
Currently, the average price of petrol is 137.75p a litre, compared to the year high of 140.03 in March.
Diesel now costs 143.39, having peaked this year at 146.38p.