Mention fuel prices to any motorist and you can be sure to get a response. With pump prices at a near all time high, filling up any car is now a major investment and one that is leading many motorists to question the affordability of staying on the road. There’s a general suspicion that motorists are being ripped off by oil companies who control much of the supply chain and who seem quick to raise pump prices but slower to drop them when crude oil prices rise or fall.
This week has seen the publication of the much-anticipated Office of Fair Trading (OFT) report into the £32bn UK road fuel market. They have concluded that there is no need for a full inquiry into the fuel industry and that “at a national level, competition is working well in the UK road fuel sector”. The report went on to conclude that there was little evidence to suggest that oil companies were not passing on reductions in crude oil prices in a timely fashion.
The reaction to the OFT report has been at best lukewarm, with the AA suggesting that it is a ”bit of a whitewash” and the RAC found that the report gave only “little comfort” to motorists.
The AA has called for more transparency in fuel pricing, pointing out that many countries (including the USA and Australia) publish wholesale and retail prices so that the public can see the correlation between the two.
Other interested parties have been more vehement. A spokesman from the Petrol Retailers’ Association (the body that represents independent fuel retailers, who made the original complaint to the OFT) called the findings “a grave disappointment”. They accused the OFT of failing to take on the big players in the oil market, including the supermarkets, and therefore hanging the smaller independent retailers out to dry.
However with about 60% of every fuel sale making its way to the country’s tax coffers as fuel duty and VAT, it needs to be notes that the oil companies actually influence a minority portion of our petrol and diesel bills.
One more positive outcome of the OFT report is the recognition that fuel prices at motorway service stations are inflated and that motorway users are often not able to see prices before leaving the motorway. The OFT has called for motorway signage to address this.
And the view from Tiger.co.uk? We recommend that motorists take advantage of the many price promotions that are available – particularly from the national supermarket chains. And of course to remember that motoring costs can be reduced in other ways too, like using a car insurance comparison
site (how about Tiger.co.uk?) to make sure you’re getting a good deal!