Petrol prices are back on the rise, according to the AA

Drivers are hit by rising fuel prices following an increase in oil costs, the AA warned today.

The average price of a liter of petrol at UK petrol stations on Monday was 148.8 pence, according to data company Experian.

That was slightly higher than the 148.4p a week earlier, but remains significantly lower than the record 191.5p set in July 2022.

It comes after the RAC reported that UK retailers were pocketing an additional £5p profit on every liter of fuel sold in 2022 in 2022, claiming there is ‘absolutely no justification for the rise in pump prices’ in the coming months. days, despite recent wholesale increases.

The increases on the gas station come after an $8 to $10 increase in oil costs this month that pushed the wholesale price of gasoline and diesel higher.

Oil had fallen below $78 (£63.33) a barrel in early January, but was valued at $86 to $88 (£69.83-£71.45) last week.

The resulting increase led to increases in the wholesale cost of road transport fuel.

Gasoline had bottomed out on December 8 at 49.2 p.liter, but stood at 62.7 p.l late last week. Diesel, which cost 66.4 pence around the same time last month, reached 71.9 pa liter on Friday.

The AA reports that oil prices have already fallen in recent days, dragging wholesale prices with them.

However, retailers who bought while prices were higher have already mirrored the rise at the pumps.

AA fuel price spokesman Luke Bosdet said: ‘After falling nearly 43 pence per liter since the summer record, drivers feared a recovery in petrol prices would eventually come.

“So far, pump price averages have only risen slightly.

“But today’s price is only 0.9 pence below the average price at the start of the war in Ukraine on February 24, when pump prices rose.”

Diesel consumed an average of 170.4 liters per liter on Monday, falling to 170.3 liters on Wednesday and Thursday last week. This is almost 29p lower than last July’s all-time high of 199.1p.

RAC fuel spokesman Simon Williams said the slight increase in average petrol prices this week was “caused by smaller retailers passing on higher costs when they have bought in new stock” in the latter part of the month.

He said there is currently no indication that the supermarkets – which are less likely to buy large amounts of fuel – have raised their prices.

“We hope this will continue, but drivers are likely to see pump prices rise gradually this year as oil is expected to rise on growing demand from China as it reopens after the Covid restrictions.

“But while the price of gasoline has clearly bottomed out, diesel is still too expensive on a wholesale cost basis,” he said.

Although fuel prices have fallen in recent months, both the AA and RAC have said retailers have not passed their savings on to UK drivers quickly enough.

An ongoing investigation being carried out by the Competition and Markets Authority said in a December update that it had found evidence that drivers are falling victim to ‘rocket and feather’ pricing – when pump prices quickly reflect rising wholesale costs but fall slowly if costs fall – during 2022.

A recent RAC study calculated that motorists were ripped off at the pumps last year by retailers who refused to pass on the full extent of the fuel cost savings and pocketed an additional 5 pence of profit from every liter of petrol sold.

The analysis showed that the average retail margin on unleaded lead in 2022 was 13.5 p.litres (supermarkets 10.8 pence) – significantly higher than the 8.7 pence in the previous 12 months (supermarkets 5.8 pence).

The average diesel margin was 10.3 pence (supermarkets 7.5 pence), up from 8.8 pence in 2021 (supermarkets 6 pence).

Prior to the pandemic, average margins in 2019 were just 6.5 pence for petrol and 6.9 pence for diesel, the RAC said.

While the automotive group said it will provide its report to the CMA to improve its research on the fuel sector, it also warned drivers to brace themselves for retailers to raise pump prices soon.

The RAC claimed that the gradual price cuts seen at UK petrol stations in recent months have now ‘crushed to a halt’ due to the rise in wholesale costs last week.

Simon Williams said the analysis found “absolutely no justification for the increase in pump prices” in the coming days based on the current wholesale cost of fuel.

It was reported last week that ministers are examining plans for a fuel watchdog to prevent drivers from being scammed at the pumps.

Chancellor Jeremy Hunt and company secretary Grant Shapps would look at a system to force gasoline and diesel retailers to pass on wholesale cost cuts to consumers.

A report on the situation is expected to be finalized by the end of February and a decision will be taken once the March budget is prepared.

Campaigners have called for an initial voluntary system, but believe powers, including the ability to name and shame garages ripping off drivers, could be deployed if retailers don’t take action.

Simon Williams from the RAC added: ‘We are urging the Government to ensure that retailers are quick to pass savings on to drivers whenever there is a significant downward movement in the wholesale price of fuel – not just to ensure that drivers not be treated unfairly, but also because there is a clear link between high fuel prices and higher inflation.’

Official fuel consumption statistics, released by HMRC on Tuesday, show petrol consumption in the UK remains at around 1.35 billion liters per month, just up from 1.4 billion liters before the pandemic.

In 2019 the UK consumed 16.851 billion liters of petrol, but last year it consumed 16.116 billion litres. In 2020, consumption fell to just 13,097 billion litres.

Similarly, diesel consumption in 2019 was 30.035 billion litres, but last year it was 29.144 billion litres. In 2020, the pandemic reduced demand to 25,029 billion liters.