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UK fuel prices rise again despite fall in wholesale costs

Date: 03 December 2021   |   Author: Sean Keywood

The price of both petrol and diesel at UK filling stations rose in November despite the wholesale cost of the fuels falling, according to data from the RAC.

The motoring organisation said the average price of a litre of petrol had increased by 3.1p during the month, to 147.28p, while diesel was up by 2.7p, to 150.64p.

Both fuels also hit new record price peaks during the month - petrol at 147.72p on 21 November, and diesel at 151.1p a day earlier.

The RAC said the increases came despite the wholesale cost of petrol dropping by 10p per litre in November, while the wholesale price of diesel fell by 7p.

It attributed this to the price of a barrel of oil falling from $84.74 to $70.90, with the discovery of the Omicron Covid variant sparking market fears.

RAC spokesman Simon Williams said: "Sadly, our data shows all too clearly that drivers are being taken for a ride by retailers at the moment. We can't see any justification for the prices that are being charged at the pumps and are concerned that drivers on lower incomes who depend on their vehicles are being priced off the road altogether. 

"The wholesale petrol price, which is what retailers pay to buy new supply, dropped by 10p from mid-November, so we can't see how any increase - let alone a 3p one - was warranted.

"Much earlier in the pandemic we saw retailers' margin on fuel understandably increase as the oil price plummeted on the back of people being told to stay at home. Despite the news of a new Covid variant, we are in a completely different world now with car use near to pre-pandemic levels so retailers shouldn't be taking huge profits on every litre of fuel they sell. 

"We therefore urge them to do the right thing and cut their prices to much fairer levels as matter of urgency."

Williams said the UK Government should intervene over the matter.

He said: "It's a sad fact that the Chancellor's fuel duty freeze last month, while welcome, simply wasn't anywhere near enough to ease the burden now being placed on millions of households who have no choice but to use their vehicles. 

"While the Chancellor could introduce a temporary cut in VAT on motor fuel it might be better for the government to ask the biggest retailers to explain why they're charging such high prices for fuel when wholesale prices have dropped."