Fuel retailers’ high price margins are ‘deeply concerning’, regulator says

Retailers’ fuel price margins are far above historic levels, according to a study by the competition regulator.

The Competition and Markets Authority (CMA) said its findings are “deeply concerning”.

Margins show the difference between what retailers pay for fuel and the price they sell it for.

The CMA’s monitoring found supermarkets’ fuel margins ranged from 8.0-9.1% in the three months to the end of June, while for other retailers it ranged from 9.9-10.6%.

That is compared with 4.0% in 2017, the CMA said.

The average price of a litre of petrol rose by 1.9p to 133.9p from the end of May to the end of August.

A litre of diesel increased in price by 3.5p to 141.9p over the same period.

AA fuel price spokesman Luke Bosdet said: “UK consumers facing inflationary pressures on all fronts 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.”

RAC head of policy Simon Williams said: “It’s very concerning that the CMA has once again concluded that fuel margins remain historically high.

“Unfortunately, the CMA’s ongoing scrutiny appears so far to have had little effect on changing retailer behaviour.”

Mr Williams added hopes of “more competitive prices” on forecourts rest with the Government’s fuel finder scheme, which is set to come into operation by the end of the year.

This will allow drivers to compare real-time fuel prices in navigation apps, in-car devices and comparison websites.

CMA senior director of markets Dan Turnbull said: “Our new report shows that drivers across the UK have been paying more at the pump in recent months.

“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 fuel finder scheme we recommended to Government will help combat this trend, pushing retailers to be more competitive as drivers are empowered with real-time pricing data – making shopping around easier than ever.”