Petrol prices: Howard Cox calls for cuts to fuel duty
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Analysis from RAC Fuel Watch shows the price of petrol was cut by just 2p a litre in December as firms failed to pass on extra savings to motorists. This means petrol and diesel drivers paid around £156million more than they should have in a massive blow to drivers budgets in the run-up to Christmas.
The RAC warns Unleaded dropped from 147.47p a litre to just 15.48p.
However, costs should have been nearer 135p if retailers had not taken “far bigger margins than normal”.
Meanwhile, diesel prices dropped from 150p to 148p when drivers should have been paying around 142p.
The RAC warns retailers took an average margin of around 16p per litre on petrol and 12.5p a litre on diesel.
Instead, the RAC says firms should have taken only around 6p per litre on each transaction which would have reduced costs.
RAC fuel spokesman Simon Williams said the news was “nothing short of scandalous”.
He said: “December was a rotten month for drivers as they were taken advantage of by retailers who rewrote their pump price strategy, costing motorists millions of pounds as a result.
“Their resistance to cutting prices and to only pass on a fraction of the savings they were making from lower wholesale costs is nothing short of scandalous.
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“The 10p extra retailers have added to their long-term margin of 6p a litre has led to petrol car drivers paying £5million more a day than they previously would have.”
“In the past when wholesale prices have dropped retailers have always done the right thing –eventually – and reduced their pump prices.
“This time they’ve stood strong, taking advantage of all the media talk about ‘higher energy prices’ and banked on the oil price rising again and catching up with their artificially inflated prices, which it has now done.”
The increase means petrol owners will pay an average of £6 more to top up their far at forecourts.
It will now cost around £80 to fill-up a 55-litre fuel tank compared to just £74 last month.
Diesel drivers can expect to pay £82 to top-up their vehicles in an increase from £78.
Mr Williams adds: “The trouble is every extra penny they take as margin leads to drivers paying even more as VAT gets added on top at the end of the forecourt transaction.
“This means the Treasury’s coffers have been substantially boosted on the back of the retailers’ action.
“We urge ministers to push retailers into doing the right thing for consumers.”
However, the Petrol Retailers Association (PRA) has hit back at the claims, adding the fuel market was still “extremely competitive”.
Gordon Balmer, executive director of the PRA told the BBC the data for December was “less reliable” and drivers were likely to have saved more than what the data shows.
He added: “December’s pump price data is less reliable because it is taken from fuel card transactions, and there have been far fewer of these transactions because of the reduction in business activity between Christmas and New Year.”
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