Petrol stations across the UK face an ‘urgent review’ of whether they have passed the 5p-a-litre fuel duty cut onto consumers quickly enough, following a request from business secretary Kwasi Kwarteng.
Kwarteng has written to the Competition and Markets Authority (CMA), asking it to examine the fuel market amid claims that retailers are profiteering from the situation.
In his letter to the UK competition watchdog, Kwarteng has asked it look at whether the duty cut is being passed on to consumers, who he said were “rightly frustrated” that prices had continued to soar at the forecourt.
“There remains widespread concern about the pace of the increase in prices at the forecourt and, that prices may not fall as much or as fast as they rise,” he added.
The CMA has also been asked to examine “whether the retail fuel market has adversely affected consumer interests”, which will include investigating price variations for petrol and diesel at local forecourts.
“Drivers should be getting a fair deal for fuel across the UK,” said Kwarteng.
“Healthy competition between forecourts is key to achieving this, with competition working to keep pressure on prices.”
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The Petrol Retailers Association said it “welcomed transparency regarding fuel pricing” and would co-operate with the investigation.
Boss Gordon Balmer said petrol stations passed on the 5p fuel duty cut after it was announced in March, but wholesale fuel prices have continued to rise since then, leaving retailers “operating on extremely tight margins”.
Boss Gordon Balmer said the association had requested several meetings with Mr Kwarteng “to explain how the fuel market works” but had not heard back.
“Our members have had to endure several [unfair] headlines in the press,” he added. “Therefore, the news that the minister has contacted the CMA to conduct an urgent review of the fuel market is timely.”
The review comes as the cost of filling an average family car has now hit a record high of £100, and as the CBI warns households will go into recession later this year.
Pump prices have been rising since Russia’s invasion of Ukraine in February led to oil supply fears. Last week, the RAC motoring organisation said the cost of filling a 55-litre tank reached £100.27 for petrol and £103.43 for diesel.
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