The UK's competition watchdog has issued a stark warning to millions of motorists, stating that high profit margins on petrol and diesel at the pumps cannot be explained by rising business costs.
Watchdog Rejects Retailers' Cost Claims
In its latest report, the Competition and Markets Authority (CMA) found that fuel margins have remained persistently high compared to historic levels. The analysis directly challenges claims from the fuel retailers' trade association, which has previously pointed to increased operating expenses as the reason for higher average margins.
Dan Turnbull, Senior Director of Markets at the CMA, stated: "Fuel margins remain at persistently high levels – and our new analysis shows operating costs do not explain this. This indicates competition in the sector is weak – if it was working well, drivers could see lower prices at the pump."
Drivers Still Paying Over the Odds
The report covers the period from November 2024 to October 2025. During this time, the average price of petrol was 135 pence per litre (ppl), which is 8 ppl lower than the same period the year before. Diesel averaged 142 ppl, also down by 8 ppl year-on-year.
Despite these lower averages, the watchdog's focus is on the margin—the difference between the wholesale price of fuel and the price at the forecourt—which remains inexplicably high. Simon Williams, RAC head of policy, commented: “Sadly, many drivers won’t be surprised to hear that they’re still paying too much for their fuel, especially judging by the complaints we receive about large price variations from area to area."
Hope Pinned on Fuel Finder Scheme
The CMA and motoring groups are now looking to a new government initiative to increase transparency and competition. The fuel finder scheme is touted as a crucial tool to empower motorists. By allowing drivers to easily compare local prices, it aims to put competitive pressure on retailers.
Dan Turnbull emphasised the scheme's importance, especially during peak travel times: "We know fuel costs are a big issue for drivers, especially at this time of year with millions making journeys across the country. This is why the fuel finder scheme is crucial – it will put power back in the hands of motorists and save households money."
Simon Williams echoed this hope, adding: “We sincerely hope the new fuel finder scheme, combined with ongoing scrutiny from the CMA, finally leads to increased competition and lower forecourt prices for drivers right across the country."
The ongoing CMA scrutiny suggests that without a significant market correction, further intervention in the sector could be considered to protect consumers from overpaying.
