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Rural fuel prices need 're-setting'

24/2/14

By Will Roberts

The president of the AA says more action needs to be taken to ensure fuel prices are not inflated in certain areas of the country.

For some time, people buying petrol and diesel in rural locations have been charged more per litre than motorists in towns and cities.

But despite the price difference narrowing in recent months, Edmund King wants the Office of Fair Trading to take action.

The gap between prices in country districts compared with urban areas is now about 2p per litre, compared with 5p a few months ago.

Local price-matching

The fall in rural prices has also brought the national average down, with petrol now costing an average of 129.63p a litre compared with 130.46p in mid-January.

Diesel now costs an average of 137.02p a litre, compared with 138.24p in mid-January.

Mr King said: "Across whole towns, for months if not years, drivers and businesses have been charged 4p to 6p a litre more for petrol compared to what retailers charged for the same fuel in neighbouring towns.

"It was called 'local price-matching' and it was supposed to be consumer-friendly.

"But without retailers prepared to challenge the inflated status quo, it was a curse and led to complaints from local politicians and a near-revolt in Newbury (in Berkshire).

'Time for pump prices to be reset'

"Drivers in those towns don't know whether to rejoice or get very angry that, would you believe it, supermarkets and other fuel markets can actually trade at 2p to 3p a litre above prices in cheaper areas.

"The change confirms the extent of the rip-off and what was, in effect, a fuel retailers' toll for motorists coming on to their forecourts.

"Competition authorities need to consider a trigger whereby, if the majority of supermarkets and other retailers in a small town charge the same price which is 4p or more higher than in a neighbouring town, that is flagged up to the official watchdog who then asks retailers why this is happening.

"It is time for pump prices in small rural and coastal towns to be put to 'reset'"

Drop in pump prices

The AA said the lowest petrol price in the last month was 129.30p a litre on February 2 - the lowest average figure for three years.

According to the AA, the strengthening of the pound against the dollar has sped up the drop in pump prices.

The price research showed that motorists in Yorkshire and Humberside have access to the cheapest petrol - at an average of 129.2p a litre.

The most expensive is in Northern Ireland, where the average price is 130.0p.


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