Petrol stations have come under fire after the Competition and Markets Authority (CMA) revealed that average fuel margins remain at historically high levels, with some retailers increasing margins to 11.3 pence per litre (ppl) in April. The regulator stated that there is no evidence of retailers altering pricing strategies to exploit the crisis, but concerns persist over weak competition in the sector.
CMA Report Highlights
The CMA's latest report indicates that elevated wholesale prices continue to explain most of the increase in pump prices in March and into April. However, the average fuel margins for both supermarket and non-supermarket retailers stayed at historically high levels, with individual retailer margins rising slightly in April. This occurred despite inventory levels and wholesale costs stabilizing to some extent.
The CMA remains concerned that sustained high retail margins reflect a continuation of weak competitive dynamics identified during its 2023 market study. The regulator will monitor whether improved supply conditions are reflected in lower retail prices over the coming weeks as the Iran war fallout continues.
Impact on Drivers
Drivers could save up to £9 per tank by shopping around, according to the CMA. Sarah Cardell, Chief Executive of the CMA, said: "We know prices at the pump are putting real pressure on drivers' pockets. While our analysis shows the rise in wholesale prices is the main reason for higher fuel prices, we remain concerned about weak competition in the sector leaving drivers paying more."
Cardell added: "Retailers should be in no doubt that we are continuing to monitor prices and margins closely and expect any reductions in wholesale prices to be rapidly and fully passed on to drivers."
Fuel Finder Tool
The CMA encourages drivers to use Fuel Finder, which can help save up to £9 per tank. The more motorists use Fuel Finder-backed services, the more effective it becomes at saving money now and driving down prices in the long run.
