London Daily

Focus on the big picture.
Saturday, Mar 14, 2026

Era of cheap supermarket fuel has 'gone' as chains battle rising costs

Era of cheap supermarket fuel has 'gone' as chains battle rising costs

An industry source tells Sky News that supermarket chains are investing in keeping the cost of essentials in check as they, and the public, battle the highest pace of price increases seen for decades.

Motorists should not expect to see a return of supermarkets using cheap fuel to lure in shoppers, an industry source has told Sky News.

They spoke out after weeks of criticism from motoring groups and fuel price campaigners that supermarket petrol stations are failing to reflect plunging wholesale fuel prices.

Data supplied by the AA and RAC has consistently shown costs for unleaded and diesel becoming cheaper at many independent forecourts, with supermarket fuel at around average or just below average levels.

They argue the sector should be leading the way on fuel prices due to its bulk-buying power, after Brent crude oil nudged levels not seen since January on Tuesday.

The pair are pushing their case at a time when the industry regulator is investigating British fuel price behaviour.

RAC fuel spokesman, Simon Williams, said: "There is yet more pressure on the biggest fuel retailers today to pass on savings to drivers as the price of oil has dipped below $80 for the first time since the start of the year causing the wholesale cost of petrol to tumble to 105p a litre and diesel to 119p.

"If a cut of at least 10p a litre doesn't come soon it will be yet more evidence of 'rocket and feather' pricing for the Competition and Markets Authority (CMA) to take note of.

"The disparity between average pump prices at 158p for petrol and 182p for diesel and their wholesale equivalents is truly shocking.

"Even taking account of major retailers' buying cycles, we can see no justification for them not cutting their prices significantly."

Supermarkets have historically charged around 3.5p per litre less at the pump than the UK average.

Fuel was effectively subsidised as part of the big four chains' efforts to grow their respective grocery market shares.

But that changed last year when COVID pandemic restrictions ended and oil prices shot up - pushed even higher this year by the effects of the war in Ukraine.


The market, particularly for diesel, has been distorted by the war in Ukraine and the West's sanctions on Russia

The source suggested that the increased costs that supermarkets were grappling, largely linked to the war, meant they were now more focused on delivering value in areas other than fuel to keep essentials down in price as much as possible.

They said that, as a result, fuel was no longer a loss leader and pre-pandemic pricing behaviour was "gone".

Oil prices have generally fallen back since July though diesel costs have remained elevated, relative to unleaded, because of Europe and the UK's past reliance on imports from Russia.

The CMA's investigation into British fuel prices, started during the summer, has been widened after it found evidence of so-called 'rocket and feather pricing' - when prices are quick to go up but slow to ease.

Andrew Opie, director of food & sustainability at the British Retail Consortium which represents supermarkets, told Sky News last month: "Retailers understand the cost pressures facing motorists and will do everything they can to continue to offer the best value-for-money across their forecourts, passing on cost reductions as they feed through the supply chain."

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said of the recent oil price falls: "The shivers of apprehension about the prospects for the world economy pushed oil prices to their lowest point in a year, with the benchmark Brent Crude dropping to $79 a barrel.

"Prices have edged up very slightly on the latest zero-COVID easing moves from Beijing, but worries about weakening global demand as recessions are predicted, are still set to limit gains.
Newsletter

Related Articles

0:00
0:00
Close
Prince Harry and Meghan Markle’s Planned Australia Visit Draws Mixed Reaction From Local Communities
Trump Calls on France and UK to Help Safeguard Strait of Hormuz Shipping Route
Boris Johnson Labels Bitcoin a ‘Ponzi Scheme’, Sparking Debate in Crypto World
UK Considers Targeted Aid for Vulnerable Households as Energy Costs Rise
Stellantis Urges Immediate Review of UK Electric Vehicle Sales Targets
Home Office Reverses Course to Allow Some Dual Nationals to Enter UK Using EU Passports
Reform UK Proposes Replacing Top Civil Servants With Officials Aligned to Government Agenda
Netflix Adds Critically Acclaimed ‘Best Film of 2025’ With Perfect Rotten Tomatoes Score
‘The Sums Don’t Add Up’: UK Farmers Hit by Soaring Costs as Iran War Disrupts Global Supplies
Confidential UK Biobank Health Records Found Online After Researchers Accidentally Expose Data
Trump Urges Britain and Allies to Deploy Warships to Safeguard Strait of Hormuz
Trump Urges Britain and Allies to Deploy Warships to Safeguard Strait of Hormuz
Middle East War Highlights Strategic Importance of Strong UK–Ireland Cooperation
Weak Growth Signals UK Economy Was Faltering Even Before Middle East Energy Shock
Marks & Spencer Tops UK Fashion Retail Rankings as Most Considered Brand
United States Launches Trade Investigation Into Allies Over Forced Labour Practices
United States Launches Trade Investigation Into Allies Over Forced Labour Practices
Russia Accuses Britain Over Storm Shadow Strike as London Reaffirms Ukraine’s Right to Self-Defence
Russia Accuses Britain Over Storm Shadow Strike as London Reaffirms Ukraine’s Right to Self-Defence
Royal Navy to Acquire Twenty Uncrewed Surface Vessels for Autonomous Warfare Testing
Russia Summons British and French Envoys After Ukrainian Storm Shadow Strike on Strategic Facility
Starmer Confirms Britain Will Maintain Sanctions on Russia Despite U.S. Policy Shift
UK Moves to Refine AI Definition in Investment Security Reform
UK Economy Stalls in January as Growth Unexpectedly Falls to Zero
Asian Energy Security Tested as Strait of Hormuz Disruption Threatens Oil Supplies
Iran Sets Three Conditions for Ending Regional War as Diplomatic Efforts Intensify
Tesla Secures Approval to Supply Electricity Directly to Homes Across Britain
Prince William Delivers Tribute to Australia’s Naval Alliance Amid Renewed Royal Spotlight on the Country
UK Foreign Secretary Travels to Saudi Arabia to Reinforce Support for Regional Allies
Putin’s ‘Hidden Hand’ May Be Assisting Iran in Conflict With Trump, UK Defence Secretary Warns
UK Sets April Deadline for Tech Platforms to Strengthen Online Protections for Children
Elon Musk Moves Into Britain’s Energy Market as Tesla Wins Licence to Supply Power
UK Watchdog Warns Fuel Retailers Against Profiteering Amid Iran War Price Surge
Report Claims Iran Used UK Charity Network to Expand Influence
United States and United Kingdom Establish Joint Standards for Counter-Drone Technology
Iran May Be Laying Naval Mines in Strait of Hormuz, UK Warns Amid Escalating Gulf Tensions
US Deploys Bunker-Buster Bombs to UK Airbase as Iran Conflict Intensifies
British Troops in Iraq Intercept Iranian Drones Targeting Coalition Base
Release of Mandelson Files Raises Tensions as UK Seeks Stable Relations With Donald Trump
UK Documents Reveal Starmer Was Warned About Mandelson’s Epstein Links Before Ambassador Appointment
Nearly Five Hundred UK Mortgage Deals Withdrawn in Two Days as Market Volatility Forces Lenders to Reprice
Three Cargo Ships Hit Near Iran as Attacks Spread to Strategic Strait of Hormuz
Why British Police Repeatedly Declined to Investigate Jeffrey Epstein’s UK Links
UK Parliament Ends Hereditary Seats in House of Lords, Closing Chapter on Centuries of Aristocratic Lawmaking
EU and UK Urge Israel to Act Against Rising West Bank Settler Violence Amid Regional Tensions
US Senator John Kennedy Says Keir Starmer Should Not Be Trusted for Military Advice Amid Iran War Debate
UK High Court Rejects Attempt to Revive Terrorism Charge Against Kneecap Rapper
Revolut Secures Full UK Banking Licence After Multi-Year Regulatory Wait
Kentucky’s Bench Boost Powers Wildcats Past LSU in SEC Tournament Opener
British Couple Die After Being Pulled From Water at Australian Beach During Family Visit
×