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Supermarkets interviewed on fuel prices at Business and Trade committee – RAC reaction

RAC fuel spokesman Simon Williams said: “While all four supermarket bosses questioned by the Commons’ Business and Trade Committee said they would support a Northern Ireland-style online fuel price checker, we know this isn’t the answer to giving all drivers fairer prices at the pumps, particularly as prices are only updated on it once a week and drivers can’t see which forecourts are cheapest. Ultimately, it comes down to how much margin retailers want to make per litre and, as the Competition and Markets Authority has already stated, supermarket fuel margins have increased significantly since 2019.

“Although an online price checker would be welcome, we also know that the supermarkets don’t dominate fuel retailing in Northern Ireland like they do on the other side of the Irish Sea, where strangely fuel prices are consistently far cheaper. For example, last month the average price of petrol in Northern Ireland was 8.5p cheaper than the rest of the UK while diesel was 10p less, making every fill up there around £5 less.

“When the wholesale price of diesel fell this spring, we saw average retailer margin reach 22p a litre which was more than three times the long-term margin of 7p. This cannot be allowed to continue when households are having to contend with a cost-of-living crisis. We believe the biggest retailers that sell the most fuel should be compelled to charge a reasonable margin per litre.

“Talk of one supermarket running three fuel-saving discount promotions was interesting as this generally only happens when wholesale prices come down significantly. It is without doubt just an attempt to drive footfall into store as opposed to passing on lower prices on the forecourt and in turn sparking greater competition which then benefits all drivers. It was also intriguing to hear the boss of Morrisons say that there’s ‘a bit more profit at the retail end of fuel’.

“For us, providing best value fuel is about truly reflecting wholesale price movements at the forecourt. This means major retailers fully passing on any wholesale savings they benefit from to drivers when they fill up. We’re concerned that to this day this still isn’t happening.”

*Article Source www.rac.co.uk

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