Petrol pump

The PRA has strongly refuted claims by the RAC that retailers are making inflated profits on petrol, and this is contributing to rising prices.

PRA executive director Gordon Balmer said: “Our members operate on razor-thin margins within a highly competitive market. To address the mounting costs of labor, energy, and the highest inflation rates seen in years, fuel margins have inevitably increased.”

“Retailers are not immune to the shifts in the global crude oil price fluctuations. Recent reductions in Saudi Arabian production levels have exerted upward pressure on prices, directly impacting pump prices. Our members remain dedicated in their commitment to ensuring their communities are well-supplied with fuel and essential goods.”

He concluded: “We urge the Chancellor to maintain the 5p cut to fuel duty and extend the freeze on the tax, providing crucial relief to both retailers and consumers during these challenging times.”

Balmer was reacting to a statement from the RAC warning that fuel prices were set to rise as the global oil price had risen to $94, its highest level since November 2022, and was expected to increase further.

RAC fuel spokesman Simon Williams said: “Since the beginning of August petrol has gone up 10p a litre and diesel nearly 13p.

“With oil now heading towards $100 a barrel, as a result of further production cuts by Saudi Arabia and Russia and rising demand from China, drivers are in for a hard time at the pumps. Diesel is set to jump in price from its current average of 159p a litre to over 170p.

“But the situation with petrol is different with RAC Fuel Watch data showing that prices on the forecourt are actually too high at an average 155.5ppl due to retailers taking bigger margins than normal. If they were playing fair with drivers, they would be reducing their prices rather than putting them up.

“However, if oil were to hit $100, it should really only take the average petrol price up by another 2ppl. But if retailers remain intent on making more money per litre with increased margins then this could be closer to 160ppl.”

He added: “The higher diesel price is in part due to its bio content being nearly twice as expensive as the petrol equivalent.”