Asda most expensive supermarket for fuel according to RAC

The RAC has said that Asda is now the most expensive supermarket for fuel, following the analysis of April’s fuel prices.

Despite a modest decrease in costs, drivers are still overpaying at the pump as supermarkets fail to reflect the significant drop in wholesale fuel prices, the motoring organisation claims.

In April, the average cost of unleaded petrol fell by 2.4p per litre to 147.88p, saving drivers approximately £1.30 per tank.

Supermarkets, however, only reduced prices by 1.2p per litre, with average diesel prices dropping further by 4.5p per litre to 153.58p. Supermarkets cut diesel prices by 3.4p per litre.

RAC data highlights a significant disparity between wholesale prices and retail prices, with retailers maintaining much higher margins than usual.

Currently, margins on petrol are at 13p per litre and diesel at 16p, compared to the long-term average of 8p.

Asda, once known for the cheapest fuel, is now more expensive than Tesco, Morrisons, and Sainsbury’s.

On average, Asda’s petrol is 2.1p more per litre and diesel 2.5p more per litre than its competitors.

RAC senior policy officer Rod Dennis commented on the issue: “A month of decreasing fuel prices should be seen as a good one for drivers, but the sheer time it is taking for any meaningful price reductions to reach forecourts is if anything a continuing cause of concern. When it comes to much-needed pump price cuts, it’s sadly a case of too little, too leisurely, with most drivers still getting a miserable deal every time they fill up.”

He added, “We’re once again in classic ‘rocket and feather’ territory, with pump prices only trickling down when they should really be falling like a stone. Not only have wholesale prices been coming down consistently for over a month, but the average margins taken by retailers are still so much bigger than in the past. This means pump prices are at levels much higher than we ought to be seeing, which is all the more concerning given drivers are meant to still be benefiting from a 5p a litre duty cut introduced more than two years ago.”

Mr Dennis also pointed out the significance of Asda no longer being the cheapest option: “It’s interesting to see that Asda no longer holds the crown for selling the cheapest fuel, despite the pledge made when it was subject to a merger a year ago. The other three major supermarkets, as well as some enterprising independents, now offer lower prices. But with only a few exceptions, there doesn’t appear to be much in the way of price competition taking place.”

With new powers granted to the Competition and Markets Authority (CMA) on 24 May 2024, the RAC hopes for a crackdown on unfair pricing practices. This could lead to fairer prices across the UK and put an end to the postcode lottery of fuel pricing.

As the country heads towards a general election, the future of the 5p per litre duty cut remains uncertain. Mr Dennis remarked, “Whichever party takes power after next month’s General Election will have the prickly job of deciding what to do about the supposedly temporary cut in fuel duty. Looking at the UK’s current pump prices, it’s easy to forget this cut is meant to ease the cost of refuelling right now.”