The RAC is urging retailers to cut the forecourt price of petrol to reflect the falling price of unleaded fuel on the wholesale market.
The price of oil is currently the biggest factor affecting the price UK drivers pay at the pumps, and a barrel of Brent crude oil ended both Monday and last Friday under $45 – the first time it has dropped to this point since early May.
The falling oil price has had the effect of pushing down wholesale fuel prices, and to a large extent has cancelled out the impact of the declining value of sterling, RAC Fuel Watch data shows. Since the day it was announced Britain had voted to leave the European Union on 24 June, the wholesale price of unleaded including VAT has fallen 2.84p to 104.65p, yet the average price on forecourts has risen by 0.54p to 112.29p. The diesel price meanwhile has remained largely static, falling just 0.26p on wholesale markets to 106.42p, and rising 0.73p to 112.72p at the pumps.
RAC spokesman Pete Williams said: “Despite some fears that petrol prices could shoot up as a result of the EU referendum, we believe there is now a strong case for a cut in the price of unleaded on UK forecourts.
“The fact remains that the headline oil price has a huge bearing on what we pay for fuel at the pumps, and it is this price that has been falling as a result of relatively weak global demand and new fears of oil oversupply.
“At a time when both consumer spending and the strength of the UK’s economy are under intense scrutiny in the wake of the EU referendum result, transparency in fuel pricing is crucial and we are therefore calling on retailers to do the right thing and pass on wholesale savings to drivers.
“Two-thirds of cars on our roads run on petrol and a cut now ahead of the school holidays in less than a fortnight would be a welcome boost to businesses and families’ pockets.
“We are also continuing to monitor the price of diesel closely to see if there is scope for a price cut in the weeks ahead.”
A cut of 2p in the price of unleaded petrol would take the average price of a litre down to around 110p, or less than 108p per litre at the cheapest forecourts.
Fuel prices have been increasing since the last winter when the average price for a litre of petrol hit a low of 101.27p.