Fuel pricesPeugeot

It "beggars belief" how drivers are not reaping the benefits of falling fuel prices, says the AA.

Average petrol prices have gone down from 138.95p a litre in mid-October to 135.08p now, with diesel dropping from 143.74p a litre to 141.89p.

But the fall in wholesale petrol prices across Europe should have knocked UK pump prices down by 10p to 11p a litre, the AA has said.

The motoring group added that despite the threat of an Office of Fair Trading (OFT) investigation of the road fuel market, "conditions that led to drivers and businesses being short-changed at the pump in the spring have happened again".

The AA said that UK drivers were also suffering again from "price postcode lottery" where motorists in one area can be charged as much as 5p a litre more than drivers a few miles away.
On average, the cheapest petrol at the moment is in Yorkshire and Humberside (134.3p a litre) and the most expensive is in south-east England at 135.7p.

Yorkshire and Humberside also has the cheapest diesel (141.0p) with Northern Ireland the most expensive (142.6p).

Motorists received another blow earlier this week when Labour's Commons motion to have the planned January 3p-a-litre fuel duty rise deferred was defeated.

AA president Edmund King said today: "It should beggar belief that, after the trauma of high fuel prices in the spring, the same thing should happen again six months later. But we are talking about the fuel industry.

"Recent political focus has been on the January fuel duty increase, either ignoring or unaware that duty's ugly sister, unrestrained wholesale prices, has been running rampant in the fuel market."

Brian Madderson, chairman of the Petrol Retailers' Association, which represents 5,500 independent forecourts, blamed supermarkets and motorway service stations for keeping the price of fuel high.

Madderson told BBC Radio 4's Today programme: "If you take diesel, the independent retailers which I represent have about 70 per cent of all the high-speed diesel fuelling facilities in the UK. The wholesale price of diesel has come down by about 3p a litre and so have the pump prices.

"(With petrol), they haven't come down as much as wholesale prices.The reason for this, we believe, is that the hypermarkets are hanging up with higher prices than usual.

"Last week, we issued a press release saying that for the first time in many months, independent forecourts were actually pricing petrol cheaper than many of the supermarkets.

"There is certainly, we would concede, something very strange when you have got motorway service areas still pricing petrol at 147.5p a litre."