UK Drivers Overpay for Fuel Due to Weak Competition, Watchdog Finds

The Competition and Markets Authority highlights persistently high fuel margins and calls for measures to increase transparency and competition in the sector.

• The Competition and Markets Authority (CMA) reports that fuel margins have risen above historic levels, with supermarket margins increasing from 7% in April to 8.1% in August and non-supermarket margins rising from 7.8% to 10.2%.
• Retail spreads, the difference between pump prices and wholesale costs, remain significantly above the long-term average of 5-10 pence per litre, with petrol at 14.9p and diesel at 16.3p per litre.
• Fuel prices have decreased since June due to global factors, with average petrol and diesel prices falling to 134.4p and 139.7p per litre by October, but drivers are still paying more than necessary.
• The CMA attributes these high margins to weakened competition in the road fuel retail market and has recommended a government-mandated fuel price transparency scheme to empower consumers.
• A new fuel-finder scheme, supported by the government and expected to launch next year, aims to improve competition by enabling drivers to compare fuel prices across the UK.

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