Pump prices for motorists have remained stable despite a significant decrease in wholesale prices, as reported by the AA. The motoring organization stated that the wholesale cost of petrol has dropped to levels last observed in 2021 before the Russia-Ukraine conflict and subsequent price surge. This decline in prices is attributed to a potential peace agreement between the two countries, leading to oil prices dipping below $60 per barrel, the lowest since May. The market is anticipated to face oversupply issues next year.
Although garages started experiencing lower petrol costs in late November, with a reduction of over 7p per liter by the end of the previous week, drivers have not seen a significant decrease in pump prices. The national average stood at 137.3p per liter this week, only marginally lower than the starting point of 137.5p in December. The AA estimated that if the full wholesale price drop had been passed on, drivers could have saved approximately £4.60 when filling a standard 55-liter tank.
Similarly, diesel prices at the pump have not decreased in line with wholesale costs, with only a minimal reduction from 146.9p per liter at the beginning of December to 146.6p this week. These findings come as many motorists prepare for the holiday season, potentially missing out on potential savings during long journeys.
The AA expressed uncertainty regarding the delay in price adjustments this time but refrained from openly criticizing retailers. Luke Bosdet, the AA’s pump prices spokesperson, highlighted concerns over stagnant pump prices in December, suggesting a missed opportunity for reductions. This situation follows the Competition and Markets Authority’s previous warning about fuel price margins exceeding historical levels, raising concerns about consumer exploitation.
Gordon Balmer, executive director of the Petrol Retailers Association, reassured that the decrease in wholesale fuel prices is gradually translating into lower pump prices ahead of the holiday period.