Fuel price drops 'should have been far bigger'
The RAC says the fall in wholesale costs aren't being reflected
A reduction in fuel prices last month "should have been far bigger", according to new analysis.
The RAC said the average price of petrol in the UK fell by 8.4p per litre in December to 151.1p, while the price of diesel dropped by 9.4p per litre to 174.0p.
This came after fuel prices decreased by around 6p per litre in November.
But the motoring organisation claims that wholesale prices mean a litre of petrol and diesel should have been around 11p and 14p cheaper at the end of 2022, respectively.
This was even allowing for a retailer profit margin of 10p per litre, which is 3p more than the long-term average.
The RAC noted that Costco's filling stations, which can only be used by the retailer's members, are charging an average of 137.3p per litre for petrol and 158.4p per litre for diesel.
RAC fuel spokesman, Simon Williams, said: "On the face of it, December looks like it was a good month for drivers, with 9p coming off at the pumps on top of November's 6p, but there's no question that the drop should have been far bigger given how far wholesale prices have come down.
"For weeks we've been calling on the big four supermarkets to cut their prices more substantially to give drivers a fairer deal when they fill up, so even though they have reduced their prices collectively by more than 10p a litre in December, they are still nowhere near where they should be given the scale of the drop in wholesale prices."
Business Secretary, Grant Shapps, wrote to fuel retailers on December 22 urging them to "ensure savings are passed on to consumers".
This came after it emerged drivers were being hit by record Christmas getaway fuel prices.
Mr Williams added: "We hope the Business Secretary's intervention just before Christmas puts more pressure on larger retailers to do the right thing."
Supermarket Morrisons launched a promotion yesterday, enabling customers to save 5p per litre on fuel at its forecourts if they spend £35 in store.
The cost of living crisis is affecting many:
Interest rates and inflation go up
Inflation rose by 8.8% in the 12 months to January 2023, down from 9.2% in December 2022. With interest rates also rising to 4%, those saving money will earn more interest on their finances, whilst those paying mortgages would pay more interest to the bank.
Energy bills
The price of energy went up incredibly as the cost of living crisis hit, with the gas price spike caused largely by the war in Ukraine. The price cap - which is set by an independent regulator to help offset costs onto customers - was set to rise to £3,549 for an average home in October but a price freeze from the government restricted the typical bill to £2,500. That's still an increase of 27% from the previous energy cap and as it's a cap on unit cost, the more energy you use the higher your bill will be.
Food prices
The cost of a weekly shop also has gone up as a result of the cost of living crisis. As a result of the war in Ukraine, a number of products including cooking oils and wheat have been disrupted. This means that several products are now considerably more expensive, driving bills up for customers.
Prices at the pumps
The average cost of petrol has also rose to unprecedented levels. Supply lines for petrol have been thrown into doubt as a result of the war in Ukraine, as Russia is a large export partner for gas, oil and fuel. In April 2022, the average price for a litre of petrol on the forecourt was 160.2p, whilst a litre of diesel would cost 170.5p. By late June 2022 the price had risen to an average of 190.9p for a litre of unleaded and 198.9p for a litre of diesel. In March 2023 the price wass on average of 147.03 in petrol and 167.04 in diesel.
Average cost of filling up a car with petrol hits £100
On 9th June 2022, the average cost of filling up a car with petrol hit £100 for the first time ever. Diesel had already hit that milestone. It comes as the cost of fuel hit a record high of one pound eighty a litre. The 2p rise was the biggest daily jump in 17 years. Prices have dropped by at least 20p per litre since the high point.