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

Drivers of diesel cars are being ripped off at the pump by retailers who are charging 17.5p a litre more than petrol, despite the wholesale price of both fuels being at the same level.

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

However, both fuels are selling for around 114.5p on the wholesale market. In fact, for two days last week, wholesale diesel was cheaper than petrol.

The motoring group said the overcharging of diesel vehicle owners by retailers is ‘absolutely shocking’ and blamed the big four supermarkets for inflating forecourts prices.

The great diesel rip off: Retailers are charging over 17p-a-litre more for diesel than petrol at the pumps despite the wholesale price for both fuels being at the same level

Since the beginning of March, the average weekly wholesale price of diesel has fallen 5p a litre, dropping from 119p to 114.5p.

In contrast, unleaded has remained almost the same throughout the month, rising from 114.6p to 114.7p.

According to the latest RAC Fuel Watch data, retailers are pocketing huge margins of 22.3p on ever litre of diesel sold. This represents 14 per cent of the total pump price.

In contrast, margins on unleaded are just 6.3p – around just 4 per cent of the full price of petrol paid by consumers. 

RAC fuel spokesman Simon Williams said: ‘The forecourt price disparity between petrol and diesel across the UK is absolutely shocking given their wholesale prices are now virtually identical.

‘At the beginning of March wholesale diesel was only 6p more expensive than petrol yet there was a 20p a litre gap between both fuels on the forecourt. 

‘Now the two fuels are identical on the wholesale market, and there’s still more than 17p difference at the pump.’

Williams said retailers are pocketing margins of nearly 20p a litre on average throughout March, compared to the long-term average of 7p.

He described the action as ‘devastating for every driver and business that relies on diesel’.

The fuel expert added: ‘The price of a litre of diesel should have already come down to around 152p, and now the wholesale price is the same as petrol at 114p we really should soon be seeing forecourts displaying prices of 147p. 

‘Sadly, this seems unlikely given current retailer behaviour. Instead, the big four supermarkets, which dominate UK fuel retailing, are charging an outrageous of 162p a litre on average.

‘As the supermarkets buy so frequently they have had plenty of time to pass on the lower prices they are benefitting from on the wholesale market to drivers at the pumps, but they remain totally resolute in their refusal to cut their prices substantially which is nothing short of scandalous, particularly in a cost-of-living crisis.’

The RAC has blamed the major supermarket retailers for inflating diesel prices. The big four – Asda, Morrisons, Sainsbury’s and Tesco – are charging an ‘outrageous’ of 162ppl on average

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

It is currently charging less than 150p per litre for diesel – though you have to hold a Costco membership in order to fill up at one of its fuel forecourts.

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

‘Since the beginning of March, they have only reduced diesel by just over 3p a litre.

‘Considering supermarket prices are usually around 4p cheaper than the UK average, their customers should have been seeing prices under 150p weeks ago.’

The RAC says it has also found evidence of many smaller independent retailers charging far less for diesel than their supermarket rivals,

The motoring organisation says this is a ‘sign of how much fuel retailing has changed’ in recent months. 

‘This would have been pretty unusual several years ago but is now rapidly becoming the norm,’ it added.

‘If smaller retailers can afford to make ends meet with lower margins and smaller sales volumes, then what excuse can the supermarkets possibly have for keeping their diesel prices so high?

‘We hope the Competition and Markets Authority, which is currently reviewing the road fuel market in the UK, is keeping a watchful eye on this pricing behaviour as we believe it’s against the interests of diesel drivers up and down the country.’

This post first appeared on Dailymail.co.uk