Drivers are being stung at the pump by fuel retailers who are unfairly boosting their profit margins, the Energy Secretary has warned.

• RAC has called on the government to crack down on profiteering fuel retailers
• Automotive group says fuel margins before pandemic were around 8p a liter
• Current margins are 18p for diesel and 12p per liter for unleaded petrol.

British motorists are being stung at the pump with “unfairly high margins” on fuel sales, a minister has warned.

The average profit margin for retailers – the difference between the amount they pay for fuel and the price they charge in car parks – has been above 18p per liter for diesel since May 7 and is almost 12 pence per liter for petrol, analysis has revealed.

It comes as the Government irons out the finer details of its ‘PumpWatch’ scheme, which would force all UK petrol stations to share real-time price information within half an hour of it rising or falling.

In a letter sent this week to Energy Secretary Claire Coutinho, the RAC said the competition watchdog must have the power to take “meaningful action” against oil companies that overcharge for oil. gasoline and diesel to drivers.

In the decade before the Covid pandemic, the average profit margin on both fuels was around 8p, meaning it is currently around double that of today.

And margins have increased in recent days due to reduced wholesale costs from lower oil prices.

The RAC estimates that if retailers charged “fairer” margins, the average price of a liter of petrol and diesel would be around 145p, down from current prices of 150p per liter for petrol and 157 pence per liter for diesel.

The automotive group’s fuel pricing expert, Simon Williams, wrote in his letter: “The RAC recognizes that retailers, along with all businesses, have been affected by high levels of inflation, but we believe that Current margins are extremely unfair to drivers who are struggling to survive the cost of living crisis.

“Furthermore, after tracking fuel prices against the Consumer Price Index, we can see that there is a clear link between the two, meaning that unfairly high margins make inflation more higher than it should be.”

He added: “Even though so much data on fuel prices has never been made public, the problem of excessively high margins from retailers persists.

“The RAC believes that this will only improve if the Competition Markets Authority (CMA), as the price watchdog, is able to take meaningful action against retailers whose margins appear unreasonable when compared to the wholesale price of fuel.”

Fourteen of the largest fuel retailers currently voluntarily share their daily pricing data through a CMA program.

However, ministers are working to make this mandatory for the entire retailer network through the PumpWatch fuel price transparency scheme.

A spokesperson for the Department of Energy Security and Net Zero said: “The Energy Secretary has made clear that retailers who fail to pass on savings to drivers at the pump will be held accountable.

“We are already giving new powers to the CMA to force retailers to confess their prices and report any scams.

“Drivers deserve to know they are getting a fair price for fuel and our PumpWatch program will do just that, helping them find the best deal.” »

Howard Cox, founder of campaign group FairFuelUK, says the negative impact of the cost of living crisis, inflation, the viability of logistics companies and SME profits continues to worsen “because greedy companies in the fuel supply chain know full well that they are arrogantly untouchable.” .

He said: “This fanfare launch by the Government of PumpWatch promised that its introduction would deliver fair, honest and transparent pump prices.

“From the beginning, I warned that fuel suppliers and their voluntary participation in the program were unsafe, and I was right.

“The CMA and the next government must introduce tough financial sanctions for decades of relentless profiteering by greedy wholesalers and oil companies at the expense of motorists, hauliers and the economy. This must stop! »

One in two drivers say rising fuel prices will be their biggest car-related concern over the next 12 months, according to a new poll of 2,007 Brits by Close Brothers Motor Finance.

Some 53 per cent of respondents said the rising cost of petrol and diesel would be the biggest strain on their finances, compared to 51 per cent in the poll this time last year.

Motorists’ biggest concerns this year

1. Increase in fuel prices – 53%

2. Auto insurance increases – 52%

3. MOT / maintenance costs – 37%

4. Cost of buying a new car – 30%

5. Road tax increases – 30%

6. Not being able to pay operating costs – 26%

7. New crackdowns on petrol/diesel vehicles – 22%

8. Parking fee increase – 20%

9. High used car prices – 19%

10. Introduction of ULEZ / similar programs – 16%

11. Lack of infrastructure development, such as charging stations – 14%

12. Not choosing the right vehicle for my needs – 11%

13. Delays in automobile production – 5%

14. Having to lend/share my vehicle with someone else, i.e. my partner or my children – 5%

Source: Close Brothers Motor Finance survey of 2,007 UK drivers

Surprisingly, this is a bigger problem for drivers than skyrocketing insurance premiums (52 percent), which have skyrocketed in recent months.

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Rising maintenance and inspection costs – linked to rising labor rates and parts prices – are the third biggest concern (37 per cent), followed by the cost of cars new vehicles (30 percent) and the increase in excise duties on vehicles (auto tax) from 1 April.

Lisa Watson, sales director at the car finance company, said: “The current increase in pumps will add further pressure to drivers who already feel they are facing increased costs in all lanes, making the ownership of a car that is difficult to afford.

“Consumers across the country are looking for ways to cope with rising costs. With the daily cost of living soaring, high interest rates and increasing prices at the gas pump, many are now having to explore other measures to stretch their finances further, including charging the fuel to their loved ones when they drive them.

What fuel retailers are saying

Gordon Balmer, executive director of the Petrol Retailers’ Association, which represents independent fuel sellers, responded to the RAC and FairFuel statement, saying petrol retailers “continue to offer motorists the best possible deals while by fighting against dazzling increases in their fixed costs.”

He continued: “Retailers are facing record levels of theft as well as increases in business rates, energy bills and the national minimum wage.

“Our members are committed to keeping pump prices as low as possible for their customers, but they are not immune to the impact of geopolitical events beyond their control.

“We have worked closely with the government to develop its fuel price transparency system, which will help motorists find the cheapest fuel available in their area.”