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Morrisons' petrol price drop below £1 fuels supermarket competition Supermarkets slash petrol prices to below £1 a litre
(about 7 hours later)
Morrisons has cut the cost of petrol to less than £1 a litre, with other supermarkets expected to follow suit as the price competition heats up before Christmas. Britain’s largest supermarkets have cut the price of petrol to less than £1 a litre for the first time in six years, delivering a pre-Christmas boost to consumers.
The company said it hoped to keep its price of no more than 99.9p for “as long as possible”. Tesco, Asda, Sainsbury’s and Morrisons have slashed the price of petrol this weekend as the oil price tumbles and the supermarket chains battle to attract festive shoppers. The average price of petrol has not fallen below £1 in the UK since 2009, peaking at £1.42 in April 2012.
Asda launched a second short-term petrol price drop on Friday, cutting it by 2p to 99.7p for three days. It said the price of diesel would be cut to 103.7p a litre; Morrisons said its diesel price would drop by 1p a litre. Tesco, the UK’s largest fuel retailer with 500 forecourts, has reduced unleaded to 99.9p per litre (ppl) and also taken a penny off diesel. Sainsbury’s is doing the same at its 301 forecourts, but petrol at Morrisons has tumbled even lower to 99.7ppl and diesel to 103.7ppl.
The RAC predicted this week that the falling price of oil and the supermarket competition for customers would lead to British drivers paying less than £1 a litre by Christmas. Asda has also joined the Christmas price war with a three-day promotion – ending on Sunday – that cuts unleaded to 99.7ppl and diesel to 103.7ppl.
The price per barrel of Brent crude dipped below $40 (£26.40) this week and the average price of diesel is already at a six-year low, dropping to 109.18p last Friday. Tesco’s fuel director, Peter Cattell, said: “We want to do all we can to help our customers in the run-up to Christmas. We know that our customers really value low fuel prices and that having unleaded for 99.9p a litre will really give customers a boost over the festive period.”
Bryan Burger, the petrol retail director at Morrisons, said: “Today, for the first time in more than six years, we are moving unleaded prices down to below £1 a litre. This is a moment where motorists will feel some relief after being clobbered by tax and price rises for the last decade.” The price of Brent crude has fallen below $40 a barrel this week, which is causing chaos for oil groups and miners, but is set to benefit consumers in the short-term at least.
He claimed the average car driver was now saving £17 a week compared with the petrol price peak of May 2011. Morrisons said it would keep the low price for as long as possible but “it remains subject to changes in oil markets and foreign exchange movements”. The RAC predicted this week that the falling price of oil and the supermarket competition for customers would lead to British drivers paying less than £1 a litre by Christmas. However, motoring organisations called for retailers to slash prices further.
An Asda spokesman said its promotion reflected the savings it had made thanks to the price of unleaded petrol hitting a six-year low. It is the second time this week the retailer has cut the price of petrol to less than £1. Simon Williams, RAC spokesman, said: “Another promotional cut to enable motorists to buy petrol at under £1 will no doubt bring early Christmas cheer to many, but we would like to see this price being held for longer than three days with oil under $40 a barrel and the wholesale price of unleaded down.”
Andy Peake, Asda’s senior petrol director, said: “We’re adding a further boost by investing in a three-day fuel price drop meaning drivers can now benefit from fuel as low as 99.7p per litre in the crucial run-up to the festive period.” It said the price cut would be in place at all its filling stations.
An Asda spokesman said the temporary price drop was not a loss leader but part of its festive pricing regime based on customer feedback and began with its decision to pull out of Black Friday.
The AA said the temporary fall would bring Asda’s petrol price below the £1 mark familiar to drivers on the continent and across the Irish Sea.
The latest figures show the price of unleaded at 83.4p in Spain and 93.2p in Ireland at the current exchange rate. Spanish drivers pay just 74.57p for their diesel and Irish motorists 86.05p.The latest figures show the price of unleaded at 83.4p in Spain and 93.2p in Ireland at the current exchange rate. Spanish drivers pay just 74.57p for their diesel and Irish motorists 86.05p.
The RAC Fuel Watch spokesman Simon Williams said: “Another promotional cut to enable motorists to buy petrol at under £1 will no doubt bring early Christmas cheer to many, but we would like to see this price being held for longer than three days with oil under $40 a barrel and the wholesale price of unleaded down.” Luke Bosdet at the AA said: “The question for non-supermarket forecourts is whether they ride out the storm or take it on with price cuts of their own. If the latter, the UK could see a serious dent in the average petrol price by the end of the weekend. The wholesale price of petrol over the past three days has recovered a penny and, while nothing is guaranteed with topsy-turvy commodity prices at the moment, drivers ought to enjoy this early Christmas gift while it lasts.
“Still, with a saving of £6.50 a tank compared with this time last year, that’s the equivalent of free parking during the Christmas shopping period thanks to the supermarkets.”