RAC urges supermarkets to slash fuel price further

RAC urges supermarkets to slash fuel price further
The RAC has called on the major supermarkets to drop their fuel prices even further as the wholesale cost of oil continues to fall.

Last week, the organisation said the big four supermarkets should all lower their prices by at least 3p and pass on savings sparked by the tumbling cost of oil back to the consumer.

Asda, Sainsbury’s and Morrisons all cut their prices by up to 2p, with Tesco yet to follow suit.

However, RAC Fuel Watch data suggests the reductions haven’t gone far enough – with the average price only slipping by a penny per litre on supermarket forecasts and by just 0.5p per litre across all UK forecourts.

With the price of oil now at £44.28 per barrel – the lowest since mid-November last year – RAC says there is “scope for both petrol and diesel to be slashed by another 2p a litre at least”.

READ MORE: RAC sparks fuel price drop on supermarket forecourts

RAC fuel spokesman Simon Williams said: “In order to be fair to motorists the big four supermarket fuel retailers should really make further cuts as the wholesale price is still falling. There is clearly scope for both petrol and diesel to be slashed by another 2p a litre at least.

“We hope they are not resting on their laurels, thinking they’ve done enough to keep motorists quiet by announcing some cuts last week when the wholesale price continues to go lower and lower.”

Mr Williams added that supermarkets’ regional pricing models make it less likely for smaller rivals to lower their prices meaning the savings aren’t being felt across the UK.

He explained: “Unfortunately, despite the supermarkets announcing cuts, RAC Fuel Watch data clearly shows that the average price of fuel sold at supermarkets hasn’t yet gone down by that much.

“This goes to show that several supermarkets operate regional pricing models rather than charging their customers the same price wherever they are, or indeed having price caps which guarantee customers pay a set amount or lower wherever they are in the country.

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“This is very important for the UK average prices as it means other retailers near to supermarkets don’t have to respond to their rivals’ lower prices. We believe this is why the UK average fuel price hasn’t gone down as much as it really should have.”

Mr Williams warned the full effects of tumbling oil prices won’t be felt across the country unless the big four supermarkets reduce prices across the whole of the UK.

He said: “For that reason we also urge all fuel retailers to reduce their prices, however we do realise that it is not as easy for smaller operators as they do not sell the same volumes that the supermarkets do.

“This is why it takes longer for reductions in the wholesale price to filter through to all the country’s 8,400 forecourts.”

Copyright Press Association 2018. Motoring News articles do not reflect the RAC's views unless clearly stated.