Drivers could be able to compare fuel prices at filling stations around the country, allowing them to find the best deal, under new plans being considered by the government.
According to the Times, Chancellor Jeremy Hunt has asked civil servants to explore the idea of creating a nationwide price watch service which would require every filling station to submit its petrol and diesel prices. It is thought such a service could lead to better value for drivers by encouraging competition between retailers.
The scheme could mimic the system already in place in Northern Ireland, where retailers are required to submit weekly price information, and which is thought to be partly behind its low fuel prices compared with the rest of the UK. The average price of petrol in Northern Ireland is currently 144.95p per litre, according to the RAC, compared with the UK average of 148.89p. The gap in diesel is even larger, with Northern Irish drivers paying 164.98p compared with 170.37p.
However, some observers have suggested the scheme should go further and explore real-time price tracking similar to systems used in Germany and France. These give live online information showing which filling stations are currently cheapest rather than town-based weekly updates.
RAC fuel spokesperson Simon Williams said: “An online fuel price checker that resembles those available to drivers in Germany where prices are displayed for individual forecourts in real-time could be helpful, but may not, on its own, lead to fairer prices. Certainly, we don’t think any UK-wide system should mimic what already exists in Northern Ireland where fuel prices are only updated once a week and there’s no indication of which forecourts are cheapest.
“One issue that often leads to widely varying prices locally, which badly needs addressing, is the fact major retailers operate regional pricing which can mean much higher prices where there is little or no competition.”
AA president Edmund King said greater transparency would help stimulate competition. He supported the idea of a real-time monitoring system as used in France and Germany but said the early adoption of a Northern Irish-style database should be explored.
He said: “The AA would be happy with a two-stage approach where the current Northern Ireland model is extended across the UK to stimulate pump-price competition as soon as possible. The more sophisticated real-time platform would follow later, as we suspect it will meet resistance from the fuel trade.”
Howard Cox, founder of the pressure group FairFuelUK welcomed the suggestion the government was considering a fuel price tracker. He said: “No one is opposed to petrol retailers earning a decent living but the current system is far too opaque.”
According to the Times, ministers have also asked officials to explore the idea of voluntary or compulsory regional fuel price benchmarks. These would consider the wholesale price of fuel and set a cap on how much retailers should charge. This is in response to complaints about how quickly retailers adjust their prices.
In December 2022, the Competition and Markets Authority reported that there was evidence of “rocket and feather” fuel pricing around the country, with retailers passing on wholesale price rises quickly but taking far longer to pass on any reductions. The RAC’s Simon Williams said this was perhaps the biggest issue facing drivers.
He commented: “Pump prices don’t always mirror movements on the wholesale market, particularly when the latter is coming down, so arguably that’s where the Government’s focus should be. Only when this happens will drivers stop losing out, as there have been far too many occasions when wholesale prices have plummeted and pump prices have taken forever to drop.”
The news comes as fuel prices begin to creep back up and BP reported record profits in 2022 – driven partly by the rocket cost of petrol and diesel. It recorded profits of £23 billion, a week after Shell also reported record profits of £68.1bn.
