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Supermarkets accused again of profiteering over petrol prices

Economy Oct 05, 2022 08:41
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Britain’s supermarket giants have again been accused of dragging their heels when it comes to passing on lower costs of petrol and raking in the profits instead.

Brent crude recently fell below US$90 a barrel and is now some 30% below its June peak but rather than pass the lower wholesale costs on, the RAC claims the grocery chains have chosen to boost profit margins on petrol sales.

Average prices per litre were 162.89p in September, a drop of nearly 7p over the month, but the motoring organisation estimates that had the full reduction been passed on a further 10p would have been lopped off the cost per litre.

Simon Williams, the RACs fuel spokesman, said grocery chain margins on a litre of petrol currently are 10p a litre or 140% higher than in the past.

“RAC Fuel Watch data has shown margins to be around 17p a litre – a huge 10p more than normal. And the average price of petrol at the big four supermarkets is only 1.5p lower than the UK average – less than half what it usually is, which points heavily to them not playing fair with drivers,” he said.

The RAC has repeatedly accused the grocery chains of being quick to raise prices when the crude price goes up and slow to reduce them when the trend reverses.

Tesco (LON:TSCO) today announced its fuel sales had risen by 39% to £4.3bn in the six months to 27 August 2022.alongside a 20% increase in its interim dividend.

In August, the Competition and Markets Authority launched an investigation into wholesale prices offered by fuel refineries, examining the differences between fuel prices in urban and rural areas, as well as the widening disparity between the crude oil price when it enters refineries and the wholesale price when it exits.

Average prices for diesel price fell by 3.5p a litre in September to 180.16p, the first time a tank of diesel has cost less than £100 since late May.

Crude prices peaked at around US$130 in mid-June due to the impact of the Ukraine war and fears over winter supplies, but reduced demand and sluggish global economic activity have seen the price ease back steadily.

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Supermarkets accused again of profiteering over petrol prices
 

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Nicholas Ball
Nicholas Ball Oct 05, 2022 8:56
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They all have, the standout supermarket being Tesco.
 
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