Pump prices for drivers have remained relatively stable despite a significant drop in wholesale costs, as reported by the AA. The motoring group disclosed that the wholesale price of petrol has decreased to levels last seen in 2021 before the Russia-Ukraine conflict and subsequent price surge. This decline coincided with oil prices dropping below $60 per barrel, the lowest since May, following talks of a potential peace agreement between the two nations.
The AA noted that garages started paying less for petrol in late November, with a reduction of over 7p per liter by the end of the week. However, drivers have not yet experienced significant savings at the pump, with the average petrol price barely changing during the same period. Despite the potential £4.60 savings on a standard 55-liter tank if the full wholesale drop was passed on to consumers, the current average pump price in the UK stands at 137.3p per liter.
Similarly, diesel prices have not decreased in line with wholesale costs. The average diesel pump price only slightly decreased from 146.9p per liter at the beginning of December to 146.6p per liter this week. These findings raise concerns for motorists gearing up for the Christmas holidays, potentially missing out on substantial savings at the pump.
The AA expressed uncertainty about the delayed pass-on of cost reductions and refrained from directly criticizing retailers. Luke Bosdet, the AA’s pump price spokesperson, highlighted the frustration felt by drivers and businesses over stagnant prices. The competition watchdog’s previous warning about inflated fuel price margins in the industry adds to the mounting pressure on retailers to justify pricing decisions.
Gordon Balmer, executive director at the Petrol Retailers Association, emphasized that reductions in wholesale fuel prices are gradually being reflected in pump prices ahead of the holiday season.
