Oil chiefs ‘not passing full price cut to drivers’

Consumers are not benefitting fully from the fall in petrol prices, according to the AA. Picture: PA
Consumers are not benefitting fully from the fall in petrol prices, according to the AA. Picture: PA
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DRIVERS are benefiting from the biggest fall in petrol prices for more than a year, but the ­industry is still not passing on the full cut in oil prices, the AA said yesterday.

Average pump prices in ­Scotland were 4.6p a litre cheaper this week than a month ago, at 123.1p – and marginally above the UK as a whole.

Diesel prices north of the Border also fell, by 3.6p to 128p, but were the highest in the UK, being more than 0.5p above the average. The AA said the cuts had followed the oil price falling by more than 11 per cent in the past six weeks, from $90 a barrel to below $80.

But it has calculated that prices would be nearly 1p lower if parts of the industry had not increased their margins.

These included refiners and market traders taking an extra 3 per cent since 2009.

AA president Edmund King said: “If the forecourts think they are being blamed unfairly and the [UK] government wants to get it right when pointing the finger of blame for families and businesses being denied the ­benefit of lower fuel costs, there is a very simple solution: oil, wholesale and pump price ­transparency.”

“Over the past nine years, the AA has called for fuel price transparency in the UK – as is the case in the US, Australia and SE Asia.

“In 2012, the UK came within inches of getting it when the then transport secretary Justine Greening called in the fuel industry.

“But the industry threw up obstacles and last year’s Office of Fair Trading report into UK pump pricing whitewashed its importance.

“Since the oil price has fallen from $90 a barrel to well below $80 in the past six weeks, drivers have been giving the retailers stick for not bringing their pump prices down more.

“The [UK] Government jumped on the bandwagon at the beginning of November, with the Treasury also putting pressure on retailers.

“The fact of the matter, though, is that retailers dragging their feet when passing on lower costs to the pump is only part of the problem.”

“It is also about time the EU commission investigating oil and fuel prices reported at least some of its findings or gave a progress report - to explain why the commodity cost of petrol remains high when the oil price falls.

“European motoring organisations, representing 35 million motorists, still haven’t had a satisfactory answer as to why petrol’s commodity price hit $1,200 a tonne with oil at $147 a barrel in 2008, but then returned to $1,200 in 2011 with oil at only $125 a barrel.”