Petrol stations have come under fire after overcharging UK motorists by £1.6bn last year, according to the Competition and Markets Authority.
The regulator’s findings reveal that fuel margins – the difference between wholesale cost and pump price – have remained well above pre-pandemic levels.
The Competition and Markets Authority said supermarkets were particularly culpable, with their fuel margins almost doubling from 2019. This rise in margins has cost drivers an extra £1.6bn in 2023 alone.
Simon Williams of the Centre for Automotive Research described the situation as “infuriating”, especially given the heavy reliance many people have on their cars. “Drivers have every right to feel cheated, especially given that there is virtually no market competition between retailers,” he added.
Last year, a review by the Competition and Markets Authority into the on-road fuel market found that competition between petrol stations was not enough to reduce costs for motorists. Supermarkets including Asda, Morrisons, Tesco and Sainsbury’s have been criticised for treating drivers like “cash cows”, after they were charged £900m in excess fees in 2022.
To address this issue, the Competition and Markets Authority has recommended the introduction of a “pump monitoring” system. This initiative would provide real-time fuel price data to drivers via mobile devices and services such as Google Maps, potentially saving drivers up to £4.50 per fill-up by making it easier to find cheaper fuel options nearby.
Currently, the Competition and Markets Authority monitors prices through a voluntary data sharing scheme. However, only 40% of petrol stations have agreed to participate, resulting in incomplete and insufficient data for use in mapping and navigation applications.
In response, the government has proposed the Digital Information and Smart Data Bill, with the aim of creating a comprehensive, mandatory regime. While this legislation is being developed, the Competition and Markets Authority has urged ministers to implement an enhanced temporary voluntary regime to mitigate excessive charging in the meantime.
The Royal Advisory Committee also called on Energy Secretary Ed Miliband to speed up implementation of the Competition and Markets Authority’s recommendations and ensure motorists are protected from excessive fuel prices as soon as possible.