RAC data reveals petrol falls to lowest price since summer 2021

The price of petrol has dropped to its lowest point since the summer of 2021, analysis of RAC Fuel Watch data reveals.*

A litre of unleaded now averages 131.91p around the UK having fallen more than 3p in January. The last time petrol was under 132p was on 2 July 2021 when it averaged 131.81p. 

January’s drop follows a 2p per litre reduction last month which means the cost of petrol has fallen more than 5p since the beginning of December when it was 137.17p, saving drivers nearly £3 (£2.90) every time they fill up a 55-litre family car. A full tank of petrol now costs £72.55.

The reduction has been driven by oil dipping below the $60 a barrel mark on 7 January – the first time it has done so since February 2021. 

Diesel has also come down by 3p to 140.97p in January but is still several pence a litre above its price at the start of July 2021 – 134.36p. In fact, even though it’s fallen 5.5p since the start of December, it’s still yet to go below the lowest price in 2025 of 138.14p a litre on 9 June. Today, a full tank of diesel now costs £77.53.

RAC head of policy Simon Williams said: “Seeing the price of petrol dip under 132p is a genuine boost for drivers, rewinding prices to those we last saw four and half years ago. And with even cheaper prices available depending on where drivers fill up, this is a positive start to the year for household budgets, especially so soon after Christmas.

“The Competition and Markets Authority’s 2025 annual road fuel monitoring report published in December said competition in the sector had not strengthened and retailer margins remained at historically high levels, and in some cases had increased. It also confirmed, contrary to what the fuel retailers trade association had been arguing, that increased operating costs were not the reason for average margins on petrol and diesel being higher.

“Our analysis of RAC Fuel Watch data also shows a similar picture of retailer margins. So, had retailers passed on more of the savings they’ve benefitted from when buying new fuel supply on the wholesale market, the January price reductions would probably have been bigger.”

The Government tasked the Competition and Markets Authority (CMA) with monitoring competition in fuel retailing in 2022. In its first report, the CMA concluded major retailers had overcharged drivers by £900m in 2022 and that all retailers were deemed to have overcharged by £1.6bn the following year.

Drivers looking to save money on their fill-ups should take advantage of the fuel finder feature in the free myRAC app. The app can be downloaded for free from the App Store or Google Play, and drivers don’t need to be RAC members to use it. Up to 10 searches a day can be made over a two, five or 10-mile radius, with each giving the five cheapest prices. 

The RAC Fuel Watch web page has more information about the average price of petrol and diesel at the big four supermarkets and at motorway services. It also features graphs showing average prices since 2000 as well as a daily financial breakdown of the cost of a litre of petrol and diesel.

^{* UK average pump prices quoted are based on Competition and Markets Authority data.}