Despite a significant drop in wholesale costs, fuel prices at the pump have remained relatively stable, as reported by the AA. The motoring organization disclosed that petrol’s wholesale prices have decreased to levels not seen since 2021, prior to the Russia-Ukraine conflict and subsequent price surges. This decline coincided with a drop in oil prices to below $60 per barrel, the lowest since May, due to potential peace negotiations between the two nations and an anticipated oversupply in the oil market next year.
According to the AA, garage expenses for petrol started declining in late November, with a reduction of over 7p per liter by the end of the previous week. However, drivers have not yet experienced significant savings, with the average petrol price barely changing during the same period. The national average stood at 137.3p per liter on Monday, only slightly lower than the 137.5p at the beginning of December. If the full wholesale price reduction had been passed on, drivers could have saved approximately £4.60 when refilling a typical 55-liter tank.
Similarly, diesel prices have not adjusted proportionally to the wholesale cost decrease. Despite a slight drop in wholesale prices, the average diesel pump price only decreased by a third of a penny from 146.9p per liter at the start of December to 146.6p on Monday.
These observations come as numerous motorists prepare for the upcoming Christmas period, planning long journeys and refueling along the way, potentially missing out on significant savings. The AA expressed uncertainty about the delay in passing on price reductions but refrained from directly criticizing retailers. The organization’s spokesperson, Luke Bosdet, highlighted concerns about stagnant pump prices and the impact on drivers and businesses. The Competition and Markets Authority previously raised alarms about retailers’ fuel price margins surpassing historical levels, indicating possible exploitation of consumers.
Gordon Balmer, from the Petrol Retailers Association, affirmed that reductions in wholesale fuel prices are gradually translating to lower pump prices just in time for the holiday season.
