UK retailers accused of ripping off motorists as fuel margins ‘remain far above historic levels’
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Version 0 of 2. Watchdog ‘deeply concerned’ that firms have ramped up petrol and diesel prices at expense of consumers Business live – latest news Retailers have been accused of overcharging motorists at the pump by the UK’s competition watchdog, which is “deeply concerned” at signs that companies have ramped up profits at the expense of consumers. The latest Competition and Markets Authority (CMA) monitoring report found that from the end of May to the end of August the average cost of petrol climbed 1.9p a litre to 133.9p, and diesel rose 3.5p to 141.9p. The CMA said that part of the increase can be attributed to a rise in the wholesale cost of oil – the price of Brent crude is currently running at an almost two-month high. However, it also said it was worried that fuel margins – the difference between what a retailer pays for fuel and what it sells for at the pump – remain far above historical highs. “Our new report shows that drivers across the UK have been paying more at the pump,” said Dan Turnbull, the senior director of markets at the CMA. “While recent price rises are partly explained by an increase in the price of oil, what’s deeply concerning is that fuel margins – a key indicator of retailer profit – remain far above historic levels.” The monitoring report found that from April to June supermarket retailers’ margins increased quarter on quarter to between 8% and 9.1%. Other petrol retailers’ margins also increased over the same period, ranging from 9.9% to 10.6%. The CMA said that in 2017 supermarket retailers’ margins were 4% but averaged 8.4% across the first half of this year. Non-supermarket fuel margins were 6.4% in 2017 but averaged 9.8% in the first half of this year. The CMA said its monitoring did not include developments in operating costs. Luke Bosdet, the AA’s spokesperson on pump prices, said: “UK consumers faced by inflationary pressures on all fronts and trying to stretch their budgets as far as they can will be incensed by this confirmation of what they suspected – they continue to be ripped off at the pumps. “The most blatantly obvious sign of this is the postcode lottery of pump prices between neighbouring towns. This is where price-matching between local rivals often, in effect, gives them permission to charge significantly more than in a town down the road.” Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion A full review of fuel retailer operating costs will be revealed in the CMA’s first annual road fuel operating report, which is set to be published at the end of this year. The government is aiming to launch its fuel finder scheme, which will enable drivers to compare real-time fuel prices in apps and online, by the end of the year. “The fuel finder scheme we recommended to government will help combat this trend,” Turnbull said. “[This will] push retailers to be more competitive as drivers are empowered with real-time pricing data, making shopping around easier than ever.” The CMA has previously said that it found that UK motorists paid £1.6bn more than they should have in 2023. |