Pump prices have remained relatively stable despite a significant decrease in wholesale costs, according to the latest report by the AA. The motoring organization disclosed that the wholesale price of petrol has dropped to levels last seen before the Russia-Ukraine conflict, as oil prices fell below $60 a barrel due to potential peace talks. Despite this decline, drivers have not yet benefited from the decrease in petrol prices at the pump.
The AA noted that garage costs for petrol began decreasing in late November, with a reduction of over 7p per liter by the end of the previous week. However, the average pump price of petrol saw minimal change over the same period, standing at 137.3p per liter this week compared to 137.5p at the start of December. If the full wholesale price drop had been passed on to consumers, drivers could have saved approximately £4.60 on a typical 55-liter tank refill.
Similarly, diesel prices have only slightly decreased on the forecourt compared to wholesale costs. The average diesel pump price went down by just a third of a penny, from 146.9p per liter at the beginning of December to 146.6p this week. These findings come as many motorists prepare for holiday travel over Christmas, potentially missing out on significant savings at the pump.
The AA expressed concern over the delayed pass-through of wholesale price reductions to consumers, highlighting that average pump prices have remained stagnant in the first half of December when they could have decreased. The organization’s spokesperson, Luke Bosdet, criticized the situation, suggesting that current pricing is causing distress for drivers and businesses. The Competition and Markets Authority’s previous warning about retailers’ fuel price margins exceeding historical levels has raised further questions about potential consumer exploitation in the industry.
Gordon Balmer, executive director at the Petrol Retailers Association, reassured consumers that decreases in wholesale fuel prices are gradually being reflected in pump prices in anticipation of the holiday season.