Stronger pound shields drivers from wholesale petrol price rise
Average UK petrol prices went back above 130p a litre at the end of April and continue to hover around that level. However, a war where supermarkets have pitted vouchers against rock-bottom pump prices still leaves the cheapest petrol in many big towns and cities at year lows of just under 126p, according to May’s AA Fuel Price Report.
In small rural towns where major supermarket competition is less fierce or only one supermarket is calling the shots, the price gap between them and cheaper major towns has started to grow again to 4p a litre. Although not as bad as last-year’s 5p or 6p excesses, the £2-a-tank difference for small cars and £2.80 for a Mondeo-sized vehicle will make more drivers again re-route their trips to take in the cheaper forecourts.
Arguably, a 2p-a-litre rise in the wholesale price of petrol since early March explains the price rise. However, with the NW European wholesale price of petrol back below $1000 a tonne after a month spell above and the pound worth nearly $1.7 last week, the pressure on retailers to put up prices should fall away.
If that happens but rural town prices fail to return to where they were earlier this year, resident drivers will know whether or not their local retailers have again set their sights on inflated margins for the summer.
Across the UK, the average pump price of petrol dipped back below 130p to reach 129.92p a litre - compared to 129.74p in mid April. Diesel, at 136.17p a litre in mid May, has barely budged from last month’s 136.26p a litre.
rural town drivers will be tempted to look elsewhere for cheaper fuel – including nearly three million long-standing AA members now with free access to mobile fuel price tracking
Edmund King, AA president
“Whereas supermarkets, faced recently with worse sales figures when fuel is factored in, have held their fire on pump price increases in cities and major towns, there are signs that some of them and other retailers are getting price-trigger happy again in rural towns,” says Edmund King, the AA’s president.
“A 2p increase in the wholesale price of petrol through March into April may justify that but, if pump prices stay higher while costs continue to fall back, rural town drivers will be tempted to look elsewhere for cheaper fuel – including nearly three million long-standing AA members now with free access to mobile fuel price tracking.”
Apart from a 0.6p-a-litre increase in Northern Ireland, where petrol prices are now typically 131.3p a litre and are significantly more expensive than anywhere else in the country, other area averages in the UK have moved at most by a third of a penny. At 129.5p a litre, Yorkshire and Humberside drivers enjoy the cheapest petrol, but not by much.
The North has seen a half-penny drop in average diesel prices to give the region the nation’s lowest price of 135.8p a litre. Prices elsewhere have remained almost unchanged, leaving Scotland the most expensive with an average 136.9p.