Pump prices for motorists have remained relatively stable despite a significant decline in wholesale costs, according to the AA. The motoring organization reported that the wholesale price of petrol has dropped to levels last seen in 2021, predating Russia’s conflict with Ukraine and the subsequent price surge. This drop in prices coincided with oil prices falling to below $60 per barrel, the lowest since May, following indications of a potential peace agreement between the two nations. Forecasts suggest an oversupply of oil in the coming year.
The AA noted that garage costs for petrol started decreasing in late November, with a decrease of over 7p per liter by last week. However, drivers have not yet experienced these savings, as the average pump price of petrol has seen minimal change during the same period. As of this week, the national average stood at 137.3p per liter, only slightly lower than the December starting point of 137.5p.
If the full wholesale price reduction had been passed on to consumers, they could save around £4.60 when filling a standard 55-liter tank, the AA highlighted. Diesel prices at the pump have also seen a smaller reduction compared to wholesale costs, with only a marginal decrease from 146.9p per liter at the start of December to 146.6p this week.
These findings come as many drivers prepare for holiday travel over Christmas, potentially missing out on significant savings at the pump. The AA expressed concern over the delay in passing on wholesale price reductions to consumers, noting that some pump prices have even increased in certain areas, causing frustration for drivers and businesses.
After the Competition and Markets Authority raised alarms about inflated fuel price margins earlier this year, industry experts have raised renewed concerns about possible consumer exploitation. The Petrol Retailers Association’s executive director, Gordon Balmer, assured that reductions in wholesale fuel prices are gradually reflected in pump prices ahead of the festive season.