Daily price comparisons across the UK shows that retailers have been slow to pass on savings to drivers. New research from the motoring group, the RAC shows that British drivers are now shelling out about 20p more per litre of diesel on average than their European Union counterparts.
The average price for one litre of diesel in the UK currently stands at 152p, with the UK holding the top spot for diesel prices in Europe for seven weeks in a row.
However drivers in Northern Ireland are relatively more sheltered from the price hikes, with diesel prices per litre being about 10p less than in the rest of the country, despite being from the same source.
With the price surge, the cost of a full tank of diesel is now £83.60 (€98.91). For a standard family car with a 55-litre capacity approximately, a full tank is now about £11 more than in the rest of Europe.
Forecourts run by supermarkets are thought to be the main culprits behind this jump in prices, with chains such as Asda, Tesco, Morrisons and Sainsbury’s charging the most. These chains currently operate about 20% of forecourts in the UK.
However, they have a significantly weaker hold in Northern Ireland, where they account for only 6% of forecourts. As such, Northern Ireland diesel prices seem to be seeing a respite.
A spokesman for the RAC, Simon Williams, told The Telegraph, “Profit margins are once again staying persistently high and drivers are paying the price.
"Our data clearly shows that pump prices haven’t fallen in line with the reduction in wholesale prices, so drivers across the UK - with the exception of those in Northern Ireland, where fairer prices are charged - are once again losing several pounds every time they fill up.
“There’s no good reason for retailers in Great Britain not cutting their prices at the pumps far further. We can only think they’re hoping no one will notice due to the distraction of the General Election.”
Why is the UK seeing diesel prices soar much higher than in Europe?
One of the key reasons for Britain seeing much higher diesel prices than Europe is due to retailers not adequately passing on falling costs to the consumer. According to the RAC, retailers are currently seeing a profit margin of approximately 16p per litre of diesel. In contrast, petrol has a slightly lower margin at 14p.
However, this is still much higher than the 3p margin seen pre-pandemic by these supermarket giants, as well as the 8p historical margin. This shows that supermarkets are still profiting from fuel price increases, while consumers are having to swallow the cost.
In turn, retailers are justifying these price increases by blaming surges in business costs and interest rates and wages, which have eroded away their profit margins.
Gordon Balmer, executive director of the Petrol Retailers Association (PRA) said, as reported by Sky News, “We must consider the significant increases in operating costs, reduced fuel volumes post-pandemic, and the substantial investments required to transition to a low-carbon transportation system.
“These factors mean that fuel retailers need to earn more from fuel sales to stay in business and invest in the future.”
This has also led to the UK government mulling over a new “Pumpwatch” scheme, which will allow consumers to compare diesel prices and boost transparency across supermarket forecourts. A price monitoring body is expected to keep an eye on this scheme, to ensure that drivers are not being overcharged more than they already have.
