Pump prices have remained relatively stable despite a significant drop in wholesale petrol costs, according to the latest findings by the AA. The motoring organization reported that petrol’s wholesale cost has decreased to levels last seen in 2021, before the Russia-Ukraine conflict and subsequent price surge. This decline was fueled by lower oil prices, falling below $60 per barrel, following potential peace talks between the two nations, with expectations of an oversupplied oil market in the upcoming year.
Although garages have experienced over a 7p per liter reduction in petrol costs since mid-November, drivers have yet to see notable savings at the pump. The national average petrol price stood at 137.3p per liter at the beginning of this week, only marginally lower than the 137.5p starting price in December. The AA estimates that if all wholesale savings were passed on to consumers, drivers could save around £4.60 on a typical 55-liter tank fill-up.
Similarly, diesel prices have not mirrored the wholesale cost decline, with only a minor decrease from 146.9p to 146.6p per liter from the start of December to the present. These developments are concerning as many motorists prepare for holiday travel, potentially missing out on significant fuel savings.
The AA expressed frustration over the lack of immediate price reductions, noting that some locations even reported price increases over the weekend. Luke Bosdet, the AA’s pump prices spokesperson, remarked on the stagnation in petrol prices, suggesting that the industry could have implemented reductions by now. This situation follows the Competition and Markets Authority’s previous warnings regarding inflated fuel margins by retailers, indicating potential consumer exploitation.
Gordon Balmer, executive director at the Petrol Retailers Association, reassured that the downward trend in wholesale fuel prices is gradually translating into lower pump prices as the holiday season approaches.