Gordon Balmer, executive director of the PRA, says it is disappointing to continually have to rectify misconceptions around fuel pricing as forecourts come under attack once again from the RAC over their margins.
Balmer’s comments come as the RAC released its monthly report on fuel prices, which found that the price of petrol has gone up more than 3ppl in the last three weeks while diesel has increased by 4ppl.
The RAC said: “Worryingly for drivers, unleaded has risen by 3.2p from 140p on January 29 to 143.4p on February 18 and diesel has shot up from 148p to 152p in the same period, adding around £2 to filling up a family car”.
Meanwhile, RAC Fuel Watch data showed that petrol had been on a welcome downward trend over the last three months, falling by 17p from 157p to below 140p in mid-January – the first time it had been below this mark since mid-October 2021. And while the price of diesel had also reduced by 15p from 163p in early October to just below 148p in late January, it was cheaper for much of last summer.
RAC fuel spokesman Simon Williams said: “News that fuel prices have bottomed out and are now on the rise again is bad news for drivers, and possibly the economy and future inflation rates, too.
“While we’re not expecting prices to shoot up dramatically, it appears that oil is trading up, which in the absence of a stronger pound, means wholesale fuel costs more for retailers to buy in. The result is higher prices at the pump and more expense for the every-day driver.
“The Red Sea attacks by Houthi rebels, which are forcing tankers to avoid the Suez Canal and instead go round South Africa’s Cape of Good Hope, are clearly playing their part, but so have global refinery maintenance closures, the start of America’s driving season and UK retailers buying more fuel stocks ahead of the Budget to protect against a possible fuel duty hike by the Chancellor.
Williams said that despite all these factors, drivers ought not to see forecourt prices go up too much more from where they are today, but he added that a lot depends on how much margin the biggest retailers decide to take.
“Positively for drivers, supermarket margins are lower than they were in January, but they are still significantly higher than they were prior to the pandemic and Russia’s invasion of Ukraine.
“If a ‘new normal’ supermarket margin were to settle around 7p, drivers would get a fairer deal. Last year, RAC data showed they benefited from an average mark-up of 10p on every litre of fuel sold as opposed to just under 6p in 2019.”
In response, Balmer said petrol and diesel prices remain volatile as retailers strive to remain competitive amidst rising costs and declining fuel sale.”
He continued: “Comments included in the RAC report demonstrate a lack of comprehensive analysis and understanding of the considerable cost escalations. Fuel margins are under significant pressure, and a thorough study, rather than relying on outdated historical margins, would result in more informed conclusions. As PRA engages with relevant government departments to seek solutions, it is disappointing to continually have to rectify misconceptions around fuel pricing.
“As previously advised by the PRA, motorists are encouraged to explore various forecourts to find the one that best fits their needs. Whether prioritising quality food, parcel services, or car wash facilities, or simply seeking the most economical fuel, PRA recommends using petrolprices.com.
“In the face of ongoing market volatility, PRA retailers remain dedicated to providing customers with the best deals possible.”
