RAC predicts pump prices are about to fall to three-year low

Unleaded petrol and diesel pump prices are falling quicker than at any other point in 2024, and are on track to hit a three-year low as early as the end of September, says the RAC. 

Both fuels are now nearly 7p cheaper than a month ago, according to RAC Fuel Watch. As of last Thursday (September 19), a litre of unleaded is being sold for 136.15p on average – down 5p since the start of September, and almost 7p lower than a month ago.

For diesel, the drop is similar with average prices down 5p since the start of the month to 140.87p, and nearly 7p lower than a month ago. 

The RAC expects average pump prices to fall to a three-year low as soon as the end of September, with the average cost of a litre of petrol potentially dipping to 132p and diesel to 138p within the next fortnight. 

It says the reason for the falling prices was because of lower global demand for oil, which brought the price of a barrel down to $73 last week. A stronger pound against the dollar, the currency oil is traded in, also contributed.

The last time prices were dropping as quickly was between late November and the end of December 2023, when average prices at the pumps for both fuels reduced by more than 7p – but then, prices on forecourts were considerably higher than they are today.

Some outlets of course are pitching prices at well under the average, with supermarkets currently charging 133.23p for unleaded and 137.69p for diesel. In Northern Ireland, where the RAC says pump prices are “fairest”, a litre of petrol is just 131.5p and diesel 134.2p.

RAC fuel spokesperson Simon Williams says while it is encouraging to see pump prices fall, he hopes the downward trend will continue.

“Based on wholesale pump prices, which is what retailers pay to buy the fuel in the first place, we know there’s scope for further price cuts so we very much hope that within the next few weeks we’ll see pump prices reach their lowest levels in three years,” he says. ”And, as our analysis clearly shows, it’s drivers in Northern Ireland who continue to get the best value with pump prices there between 5.5p and 6p cheaper per litre compared to the average across the whole of the UK.”

He adds that the RAC looks forward to government proceeding with its plans to introduce greater pump price transparency with the Pumpwatch scheme, along with an official monitoring function to ”help ensure drivers are charged a fair price every time they fill up”.