RAC calls for immediate 3p cut in fuel price as oil market weakens

RAC calls for immediate 3p cut in fuel price as oil market weakens
The RAC is calling for fuel retailers to make “an immediate cut” in the price of unleaded and diesel following a steady fall in the cost of oil over the last month.

The RAC already issued a statement expecting a 2p cut off the price of unleaded petrol following Brexit, earlier this month, and now the motorist's champion believes there is a “compelling case” for knocking 3p off the price of fuel at the pump.

The reasoning beind this comes in the wake of plummeting oil prices, which now stand at their lowest level since early May, the RAC said.

As a result, the amount retailers pay for fuel including VAT has been decreasing over recent weeks to hit 103.65p for petrol and 104.32p for diesel.

Yet retailers have failed to pass these savings on to consumers, who have instead faced having to fork out more and more money for fuel on the forecourts.

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The average price of a litre of fuel at the pump has continued to increase since last winter, when it reached a low of around 101.27p.

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This figure now stands at around 112p, with some motorway service stations even charging as much as 127p for a litre of fuel, figures from the RAC Fuel Watch show.

Simon Williams, the motoring organisation’s fuel spokesman, said he hoped retailers were not “taking advantage of public perceptions” that fuel prices would rise following the Brexit vote last month.

In actual fact, he pointed out, prices in the wholesale oil market have been on a downward trend, driven by oversupply and concerns about the global economic outlook.

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“There is now a compelling case for an immediate price cut of 3p per litre off the price of both petrol and diesel at forecourts,” Mr Williams said.

“That would take average prices down to around 109p per litre, and would see some of the most competitive retailers selling unleaded and diesel around 106p.”

“With millions of families currently away on holiday or soon to leave, combined with a boom in staycations this year, a cut now would be widely welcomed and would give motorists confidence that retailers are not keeping prices artificially high.”

He added that as retailers have a reasonable record of passing savings on to motorists, he hoped that the current prices represented a blip rather than the new norm.

“We believe retailers should now act by passing on the savings they are making to the UK’s motorists,” he said.

Copyright Press Association 2016. Motoring News articles do not reflect the RAC's views unless clearly stated.