As the average price of unleaded petrol slid below 120ppl, a leading economist told a committee of MPs the price could fall by another 10ppl to 15ppl.

Experian Catalist reported the average price of unleaded petrol had fallen to 119.40ppl, with diesel at 124.07ppl, on Tuesday December 9, the same day as Kevin Daly, senior economist at Goldman Sachs, was presenting evidence to the Treasury Select Committee.

Referring to the recent sharp fall in oil prices, he said: “If [prices] remain at these levels we’re likely to see a litre of unleaded petrol fall to between £1.05 and £1.10 per litre.”

This followed further downward pressure on retail prices over the weekend as Asda cut 2ppl off its fuel prices, capping unleaded petrol at 115.7ppl and diesel at 119.7ppl, and the RAC claimed there was scope for retailers to reduce unleaded prices by a further 7ppl and diesel by 6ppl.

Asda’s price cut, which took effect on Saturday, was its second in eight days and means that since September 28 its price cap has come down 11ppl on unleaded petrol and diesel has reduced by 10ppl.

Andy Peake, Asda’s petrol trading director, said: “With our second price cut in a week, we’re giving customers the chance to fill up their tanks with some of the cheapest fuel around, as we know how important it is to pass savings back into motorists’ pockets as soon as oil prices fall. No matter where customers live, they will benefit from the same fuel price with our national price cap of 115.7ppl for unleaded and 119.7ppl for diesel.”

Meanwhile, RAC spokesman Simon Williams said: “The tumbling oil price, coupled with a pound that is still strong against the dollar, have led to a phenomenon that many motorists are pretty unfamiliar with – falling pump prices. The forecast reduction that retailers should be passing on is the biggest the RAC has seen in recent years, even since petrol began to come down from its record high of 142.48ppl on 17 April 2012 (diesel 147.93ppl – 13 April 2012).

“Retailers now have a very reasonable record on transparent pricing so we have no reason to believe that they will not pass on the savings in the wholesale price. We just urge them to do it sooner rather than later to make the point very clearly to motorists that they operate a fair pricing system.

“If they do, we could well see petrol pump prices fall by well over 7ppl in the next few weeks and diesel by almost 6ppl.

“With this kind of drop in the national average prices, motorists will no doubt see some very low petrol prices – perhaps under 110ppl from retailers who pride themselves on having the lowest prices.

However, he acknowledged: “While motorists are enjoying much lower forecourt prices it’s important to recognise that they will always be limited by fuel duty, which represents nearly 58p in every litre, and VAT which is charged on top, at around 20p a litre. A driver filling up a 55-litre petrol car at 114p a litre would therefore pay £62.70 of which £31.87p would be duty, £10.45 VAT and only £20.38 for the fuel itself.”