RAC predicts further fuel cuts as petrol moves to a new wholesale low
Petrol wholesale price reaches 2013 low
Despite the price of both petrol and diesel falling considerably in the past few weeks, the RAC predicts motorists could soon be seeing even lower prices at the pump due to further reductions in the wholesale price of fuel.
On 17 September when the Syrian crisis subsided and the pound was at a seven-month high against the dollar, the average price of unleaded was 137.64p and diesel 142.50p. By 6 October unleaded had dropped to 132.34p and diesel to 139.00p – a saving of over 5p litre on petrol and 3.5p on diesel.
While these predominantly supermarket-led savings make a real difference for motorists, prices could still go lower as the wholesale price of unleaded has now reached its lowest price since the first week of December last year*, going below 102p a litre (101.50p) on Tuesday 1 October and staying at a similar level throughout the week. Diesel, however, is still slightly adrift of its 12-month wholesale low of 104.87p on 1 May 2013 at 108.08p on Friday 4 October.
The two-week pricing forecast is for a reduction of almost 4p in petrol and nearly 2p in diesel which would mean average prices of around 129p and 137p respectively – taking prices below previous lows for the last year.
The supermarkets have, however, already brought their fuel down to this level, demonstrating transparency by passing on the wholesale savings to motorists, so the new predicted average figures will only be achieved if other fuel retailers continue to reduce their prices.
The 12-month retail price high points for both petrol and diesel came on 5 March 2013, with unleaded at an average price of 140.03p and diesel 146.46p. (See table below for 12-month wholesale and retail highs and lows.)
Unleaded reached a 12-month average retail low on 8 January 2013 at 131.93p whereas diesel’s low came on 13 May at 138.05p. Since May, however, prices of both fuels began to slowly rise again until they were reversed by the mid-September reductions.
The RAC is confident fuel retailers will continue to pass on reductions in the wholesale price of petrol and diesel to further ease pressure at the pumps for motorists.
RAC head of external affairs Pete Williams said: “Fuel retailers have clearly demonstrated the transparency of their operations by cutting more off a litre of fuel than many people will be able to remember. As well as saving people hard-earned cash at the pumps, this level of transparency has no doubt created a lot of goodwill with their customers.
“Motorists often complain that prices seem to go up far faster than they come down, but this autumn is proof that this is not necessarily the case.”
The price of fuel is one of the hottest topics with drivers nearly half (46%) of 1,500 motorists surveyed for the RAC Report on Motoring 2013 saying the cost of driving is still their number one motoring concern. The report also found that 78% of drivers see their car as an integral part of their lives, admitting they would find it difficult to adjust life without a vehicle. More than half (54%) said they would have a fuller social life, visiting family and friends more often, if fuel was more affordable.
A supporter of the FairFuelUK campaign, the RAC strives to be the motorist’s champion by calling on the Government to drive down costs at the pumps by capping, or reducing fuel duty from nearly 58p per litre.
