Oil Prices Down but UK Petrol Prices Remain High: An Overview
Brent crude oil prices have fallen to about $62–$64 per barrel, yet petrol and diesel pump prices in the UK remain high, with petrol around £1.37 per litre and diesel about £1.46 per litre. This compares to January levels of approximately £1.39 per litre for petrol and £1.45 per litre for diesel.
The UK currently has four operational refineries following closures this year, including the shutdown of the Grangemouth refinery which has left Scotland without domestic fuel production. Factors cited for the decline in domestic production competitiveness include government carbon charges and costly delivery structures.
The Competition and Markets Authority (CMA) has found that drivers often pay more than necessary for fuel, and ongoing investigations have noted price disparities, including postcode price variations of up to 9p per litre between towns only 10 miles apart. Critics argue that the CMA has not fully considered retailers' operating costs in these assessments.
The Petrol Retailers Association (PRA) states that average margins across forecourts remain at 3–4% after costs and have not increased compared to a year ago. They argue that rising costs in the economy—such as energy, business rates, the minimum wage, employer National Insurance contributions, and forecourt crime—are passed onto consumers, denying claims of profiteering.
To boost competition, the CMA recommended the introduction of a Fuel Finder scheme providing real-time price comparison, with the government planning to launch this by spring 2026. Current data remains limited in the lead up to the scheme which aims to reduce postcode price variation.
The CMA is expected to release its next comprehensive market update within weeks, incorporating more extensive cost data. An annual report later in the month will further detail the assessment of operating costs and their impact on fuel pricing.
