The Petrol Retailers’ Association (PRA) has questioned Downing Street’s plans to force Motorway Service Areas to display the cost of fuel on road signs.

Service stations were identified by the Office of Fair Trading in its report on the service station sector, published in January, which suggested that prices at motorway forecourts were often higher than those elsewhere - typically 8ppl higher for diesel and 7.5ppl for petrol.

The report said there was a lack of transparency, with drivers only discovering the price of fuel when they came off the motorway. In France fuel prices are signposted on the motorway for miles in advance of the service areas.

PRA chairman Brian Madderson said: “Following the OFT report on fuel prices issued in January, Motor Service Area operators, including PRA members, have had the opportunity to discuss the practical implications of price signage with the Highways Agency - the specialist Government Agency responsible for motorways and major trunk roads.

“Particular concern was raised about the safety issues surrounding drivers travelling at high speed being distracted by electronic signage whether on overhead or roadside gantries.

“In addition, if the operators had to pay for the necessary infrastructure investment, fuel prices might actually have to be increased. Therefore, doubt was expressed as to whether signage would in fact cause prices to reduce.

“The Prime Minister should be very concerned about the impact high fuel prices are having on household budgets and businesses. However the correct approach would have been to review the whole UK market for road fuels as the PRA had recommended with its formal complaint to the OFT nearly 18 month ago. Instead, the Government has allowed the OFT to duck the issue so the lack of price transparency and the volatility of wholesale costs continue unchecked.”