For the first time since 2022, Asda has significantly reduced its petrol and diesel prices, responding to falling wholesale costs. The supermarket chain has cut 4p per litre across all its forecourts, bringing its petrol and diesel to their lowest levels in three years.
The price cut means petrol now costs 131.96p per litre, while diesel stands at 137.63p per litre at Asda and Asda Express stations. This move follows concerns that UK fuel retailers were slow to pass on savings from reduced wholesale oil prices, with consumer groups urging supermarkets to act.
Asda Responds to Lower Wholesale Costs
The price reduction comes amid a wider industry debate about fuel costs and price transparency. According to the RAC, oil prices have dropped from $80 (£61) per barrel in mid-January to below $70 (£54), leading to lower wholesale fuel prices. Yet, until now, retailers had not widely reflected these savings at the pump.
Asda’s move sets its fuel prices below the UK national average, where drivers are currently paying 138.6p per litre for petrol and 145.8p per litre for diesel, according to government data. The decision has been welcomed by industry experts, with RAC head of policy Simon Williams stating that this reduction should prompt other retailers to follow suit.
“It’s great to see Asda leading the way once again with a serious price cut on its forecourts, following our call for retailers to pass on savings from lower wholesale costs. This should spark others into action and help bring down costs for drivers right across the country.” Williams said.
Supermarket Pricing Under Scrutiny
The decision to lower prices comes amid criticism that UK supermarkets have been profiting from higher fuel margins. The Competition and Markets Authority (CMA) found that drivers paid £900 million more for fuel at supermarkets in 2022, with an additional £1.6 billion across all retailers in 2023 due to increased profit margins.
According to Luke Bosdet of the AA, pump prices should have started falling “a long time ago,” suggesting that retailers were waiting for competitors to make the first move before adjusting their own prices. He also pointed to the forthcoming CMA ‘fuel finder’ scheme, which will be mandatory in 2025, as a potential solution to price discrepancies.
“We suspect that the retailers, knowing that there was room to lower prices, were watching each other locally to see who would budge first.” Bosdet said.
Fuel prices in the UK remain influenced by multiple factors, including global oil supply and demand, refining capacity, exchange rates, and distribution costs. While Asda’s decision offers immediate relief to drivers, industry experts will be watching to see whether other major fuel retailers follow suit.
