The price of petrol fell by more than 5p per litre in November, the biggest monthly drop since January 2015 and the first major price reduction since June as retailers finally reacted to falling wholesale prices.
Data from RAC Fuel Watch shows unleaded fell from 130.61p to 125.43p (down 5.18p) in November and diesel dropped 2.5p from 136.93p to 134.42p.
Petrol at the end of November was back to a price last seen in mid-May whereas diesel went back to its end of September level. Despite the positive news at the pumps the RAC’s analysis of wholesale fuel prices shows drivers have been overcharged on the forecourt to the tune of 10p a litre for unleaded and 7p for diesel, and average prices should still fall considerably over the course of the next fortnight if retailers play fair.
RAC fuel spokesperson Simon Williams said: “The oil price plummeted by 24% throughout November which proved to be positive for motorists – indeed we haven’t seen such a large drop in average prices in nearly four years. Having finished October at $75, a barrel of crude ended the month only costing $57 which sent wholesale prices tumbling even though the value of sterling dropped by 2%.
“This should have translated to the average price of petrol being around 120p a litre, but retailers chose not to pass on the savings meaning the current average still remains unnecessarily high at 125.43p. While one of the big four supermarkets has consistently cut the price of unleaded the others haven’t by as much which has meant the UK average price didn’t drop as much as it should have done.
“Based on our data, petrol still ought to come down by 7p a litre in the next two weeks and diesel by 5p. While this seems unlikely based on retailers’ current track record, we can only hope they are planning some cuts in the run-up to Christmas with a view to getting more shoppers into their stores.
“In the last six years we haven’t seen retailers take this much margin from selling a litre of petrol over such a protracted length of time. Wholesale unleaded began falling from mid-October but retailers were reluctant to reflect this on the forecourt despite the RAC highlighting the issue on numerous occasions. For some time prior to this we had been happy to praise retailers for passing on wholesale savings on the forecourt and say there was little evidence of ‘rocket and feather’ pricing. Now, however, there is very clear proof that many retailers are operating ‘rocket and feather’ policies.”
The cost of filling up a family-sized car with 55 litres of unleaded at the end of November stood at £68.98 – a saving of £2.85 on a month ago. The equivalent for a diesel vehicle is £73.19 which translates to £1.38 less for a tank since the end of October.
On 29 November the average price at the big four supermarkets was 121.27p for petrol and 130.96p for diesel. Motorway services, which have been even slower to reduce their prices, were charging an average of 145.40p for unleaded and 153.70p for diesel. On 20 November, however, the average price of diesel at services reached 155.40p a litre which matched the previous high of April 2012 when average fuel prices across the UK were at record levels.