October Fuel Price Report

Fuel prices collapse faster than June's record rise

20 October 2008

a petrol station fuel filler nozzle

Average UK petrol prices have collapsed by 6.5 pence per litre over the past month, a margin that beats the record rise in June this year and is second only to the fall in prices following the end of the 2006 Lebanon crisis, according to this month's AA Fuel Price Report.

The report, a mid-month snapshot of fuel prices across the UK, does not reflect the latest stage of the supermarket price war that saw prices breaking back through the £1-litre mark in many towns on Wednesday and Thursday.

Even so, UK average petrol prices between mid-September and mid-October have crashed from 112.88 pence per litre to 106.4. Diesel has fallen even further, from 124.26 to 117.68. The 6.48 pence petrol price change compares with the record 5.6 pence increase in June and the 7.9 pence drop in September 2006.

With petrol prices reaching a record high of 119.7 pence per litre on 17 July (diesel 133.25p), UK drivers have on average seen a 13.3-pence drop in the cost of a litre. This has:

  • reduced the cost of a 50-litre tank refill by £6.65
  • reduced the monthly petrol cost of a two-car family by £28.51 (£256.56 to £228.05)
  • pumped daily an extra £8.8 million into potential consumer spending from the reduced UK spend on petrol

Even with intense scrutiny of fuel prices by consumer watchdogs in Northern Ireland, petrol prices there have dropped by a penny less than the average fall to 107.9 pence per litre, leaving it the most expensive region to buy petrol in the UK. The cheapest area to buy petrol in the country is the North West, selling petrol more than two pence below the Northern Ireland average.

AA comment

"The ongoing supermarket price war leaves prices across the UK in a very fluid state. Prices have dropped the quickest and to the lowest in the heartlands of the more fiercely competitive supermarkets, like Asda. However, Tesco exhibited an impressive show of firepower when it slashed petrol prices 3p across-the-board, helping to bring the UK average down by an unprecedented 2p a litre over a weekend. Drivers hope supermarkets will continue to challenge hard at the pumps," says Edmund King, the AA's president.

"Competitive pricing, however, is not solely a supermarket speciality: the AA has seen a number of independent fuel stations undercutting the big stores. Even Asda's and Morrison's announcement of 99.9p for a litre of petrol on Wednesday was beaten by a couple of "minnow" retailers in Elgin and Kidderminster. The addition of shops and mini-stores to small petrol stations may be encouraging smaller retailers to cut the price of fuel and make their profit on groceries and other sales."

View the full AA Fuel Price Report.

Petrol


Comparison by brand (15 October 2008)


Brand This month
(pence/litre)
Last month
(pence/litre)
Price change
(pence/litre)
Asda 103.25 109.74 -6.49
BP 107.16 113.34 -6.18
Esso 106.38 112.74 -6.36
Jet 106.59 111.91 -5.32
Morrisons 102.28 110.73 -8.45
Murco 106.56 113.49 -6.93
Sainsbury 105.15 111.29 -6.14
Shell 108.00 114.55 -6.55
Tesco 105.09 112.11 -7.02
Texaco 107.78 113.87 -6.09
Total 106.33 112.96 -6.63
UK average 106.40 112.88 -6.48


Diesel


Comparison by brand (15 October 2008)

Brand This month
(pence/litre)
Last month
(pence/litre)
Price change
(pence/litre)
Asda 114.11 121.25 -7.14
BP 118.29 124.69 -6.40
Esso 116.91 123.78 -6.87
Jet 117.43 123.10 -5.67
Morrisons 114.23 122.24 -8.01
Murco 117.6 124.24 -6.64
Sainsbury 116.10 122.80 -6.70
Shell 119.96 126.69 -6.73
Tesco 116.10 123.64 -7.54
Texaco 118.86 124.86 -6.83
Total 117.41 124.24 -6.58
UK average 117.68 124.26 -6.58


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20 October 2008
(Price data provided by Experian Catalist)