Wholesale diesel at same level as petrol but is 17p pricier at pumps

Diesel car drivers are being ripped off at the pump by retailers charging 17.5 pa liters more than petrol, despite the wholesale price of both fuels being the same.

The average price of petrol is 146.63p, while diesel is 164.26p, according to the latest report from RAC Fuel Watch.

However, both fuels retail for about 114.5 pence on the wholesale market. In fact, last week wholesale diesel was cheaper than petrol for two days.

The motorists’ group said retailers’ overcharging of diesel vehicle owners is “absolutely shocking” and blamed the four major supermarkets for driving up prices at petrol stations.

Since the beginning of March, the average weekly wholesale price of diesel has fallen by 5 pence per litre, from 119 pence to 114.5 pence.

Lead-free, on the other hand, was broadly flat throughout the month, rising from 114.6 pence to 114.7 pence.

According to the latest data from RAC Fuel Watch, retailers are earning huge margins of 22.3 pence on every liter of diesel sold. This represents 14 percent of the total pump price.

In contrast, margins on unleaded petrol are only 6.3 pence – about just 4 percent of the full price of petrol paid by consumers.

RAC fuel spokesman Simon Williams said: ‘The price difference at the petrol station between petrol and diesel in the UK is absolutely shocking as their wholesale prices are now virtually identical.

At the beginning of March, wholesale diesel was only 6 pence more expensive than petrol, but at the gas station there was a gap of 20 pence per liter between the two fuels.

“Now the two fuels are identical on the wholesale market and there is still more than 17 pence difference at the pump.”

Williams said retailers pocketed an average of nearly 20 pence per liter in March, compared to the long-term average of 7 pence.

He described the action as “devastating for every driver and every company that depends on diesel.”

The fuel expert added: ‘The price of a liter of diesel should already have dropped to around 152 pence, and now that the wholesale price is the same as petrol at 114 pence, we should soon be seeing petrol stations with prices of 147 pence.

“Unfortunately, this seems unlikely given the current shopping behavior. Instead, the four major supermarkets, which dominate the British fuel retail trade, charge an outrageous 162 pence per liter on average.

Because the supermarkets buy so often, they have had plenty of time to pass on the lower prices they benefit from on the wholesale market to the drivers at the pump, but they remain resolute in their refusal to substantially lower their prices, which is nothing short of is then of scandal, especially in a crisis of the cost of living.’

The RAC has blamed major supermarkets for driving up diesel prices. The big four – Asda, Morrisons, Sainsbury’s and Tesco – charge an ‘outrageous’ average of 162ppl

The RAC says Costco is the retailer passing on the most savings from falling wholesale diesel costs.

It currently charges less than 150 pence per liter for diesel – although you must have a Costco membership to fill up at one of the filling stations.

But even Costco could do more to help drivers, Mr Williams points out.

‘Since the beginning of March they have only reduced the diesel by just over 3 pence per litre.

“When you consider that supermarket prices are usually around 4 pence cheaper than the UK average, their customers should have seen prices below 150 pence weeks ago.”

The RAC also says it has found evidence that many smaller independent retailers charge much less for diesel than their supermarket rivals.

The motoring organization says this is a “sign of how much fuel retailing has changed in recent months.”

“This would have been quite unusual a few years ago but is now quickly becoming the norm,” it added.

‘If smaller retailers can afford to get by on lower margins and smaller sales volumes, what excuse can supermarkets have for keeping their diesel prices so high?

“We hope that the Competition and Markets Authority, which is currently reviewing the fuel market in the UK, will keep a close eye on this pricing behavior as we believe it goes against the interests of diesel drivers across the country.”