Drivers pay £1.6 billion extra for fuel as retailers maintain “outrageous” profit margins

Drivers paid an additional £1.6 billion for fuel last year due to retailer margins which remain “significantly above historic levels”. A report from the Competition and Markets Authority (CMA) uncovered how retailer profit margins have risen steeply since 2019 from an average of 4.4 per cent to a high of 8.1 per cent in in January 2023.

As a consequence, drivers have been grossly overpaying for their fuel, with the CMA previously highlighting how in 2022, supermarket fuel stations had overcharged customers by as much as £900 million.

The CMA says profiteering fuel retailers are “failing customers” and that the implementation of the previous Conservative government’s PumpWatch scheme – something designed to provide drivers with up-to-date pricing information for surrounding fuel stations – could save the average person as much as £4.50 per tank of fuel.

For the time being, the RAC’s head of policy, Simon Williams, has described the situation as “outrageous”, saying that “drivers have every right to feel ripped off, especially knowing there is virtually no market competition between retailers.”

The RAC claims it has written to the new Energy Secretary, Ed Miliband, asking him to implement the CMA’s recommendations “as quickly as possible” in order to save the wallets of motorists across the country.

At the time of writing, the average price of petrol sits at 145.08 pence per litre, with diesel hovering around 150.25 pence. This is down from a high earlier this year in May at 150 pence per litre for petrol and 158 pence for diesel. Petrol and diesel prices are expected to keep gradually falling, although the CMA says the full implementation of the PumpWatch scheme “may take time”, with only 40 per cent of retailers currently signed up.

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