Fuel costs inflated by lack of competition – CMA
The latest CMA report into fuel costs in the UK has revealed that a lack of competition is still leading to higher prices at the pumps.
The report said that ‘effective competition remains a concern’ and that passive pricing strategies are also contributing to sustained high margins.
Its analysis found that some retailers are not immediately passing reductions in wholesale diesel prices on to drivers, a move which would have intensified competitive pressure on rival retailers.
Sarah Cardell, chief executive of the CMA, said: “We know prices at the pump are putting real pressure on drivers’ pockets and our monitoring plays an important role in giving drivers confidence that retailers are not taking advantage of the conflict in the Middle East. We will continue to monitor prices and margins closely and expect any reductions in wholesale prices to be rapidly and fully passed on to drivers.”
RAC head of policy Simon Williams added: “It’s very concerning that margins on fuel remain historically high, competition is still lacking and that some retailers were deemed not to have reduced prices as quickly as they should have when the diesel wholesale price fell earlier in the summer.
“We’re therefore pleased the CMA is going to be taking a closer look at retailer pricing strategies and whether wholesale price changes are reflected at the pumps fast enough.
“We also urge the watchdog to compare fuel retailing in Northern Ireland with the rest of the UK, as petrol and diesel are currently being sold there for an average of 8p less a litre. If fuel can be sold there at lower prices, then it seems drivers elsewhere aren’t being treated fairly.”
