London Daily

Focus on the big picture.
Wednesday, Dec 17, 2025

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
Trump Files $10 Billion Defamation Lawsuit Against BBC as Broadcaster Pledges Legal Defence
UK Says U.S. Tech Deal Talks Still Active Despite Washington’s Suspension of Prosperity Pact
UK Mortgage Rules to Give Greater Flexibility to Borrowers With Irregular Incomes
UK Treasury Moves to Position Britain as Leading Global Hub for Crypto Firms
U.S. Freezes £31 Billion Tech Prosperity Deal With Britain Amid Trade Dispute
Prince Harry and Meghan’s Potential UK Return Gains New Momentum Amid Security Review and Royal Dialogue
Zelensky Opens High-Stakes Peace Talks in Berlin with Trump Envoy and European Leaders
Historical Reflections on Press Freedom Emerge Amid Debate Over Trump’s Media Policies
UK Boosts Protection for Jewish Communities After Sydney Hanukkah Attack
UK Government Declines to Comment After ICC Prosecutor Alleges Britain Threatened to Defund Court Over Israel Arrest Warrant
Apple Shutters All Retail Stores in the United Kingdom Under New National COVID-19 Lockdown
US–UK Technology Partnership Strains as Key Trade Disagreements Emerge
UK Police Confirm No Further Action Over Allegation That Andrew Asked Bodyguard to Investigate Virginia Giuffre
Giuffre Family Expresses Deep Disappointment as UK Police Decline New Inquiry Into Andrew Mountbatten-Windsor Claims
Transatlantic Trade Ambitions Hit a Snag as UK–US Deal Faces Emerging Challenges
Ex-ICC Prosecutor Alleges UK Threatened to Withdraw Funding Over Netanyahu Arrest Warrant Bid
UK Disciplinary Tribunal Clears Carter-Ruck Lawyer of Misconduct in OneCoin Case
‘Pink Ladies’ Emerge as Prominent Face of UK Anti-Immigration Protests
Nigel Farage Says Reform UK Has Become Britain’s Largest Party as Labour Membership Falls Sharply
Google DeepMind and UK Government Launch First Automated AI Lab to Accelerate Scientific Discovery
UK Economy Falters Ahead of Budget as Growth Contracts and Confidence Wanes
Australia Approves Increased Foreign Stake in Strategic Defence Shipbuilder
Former UK Prime Minister Boris Johnson proclaims, “For Ukraine, surrendering their land would be a nightmare.”
Microsoft Challenges £2.1 Billion UK Cloud Licensing Lawsuit at Competition Tribunal
Fake Doctor in Uttar Pradesh Accused of Killing Woman After Performing YouTube-Based Surgery
Hackers Are Hiding Malware in Open-Source Tools and IDE Extensions
Traveling to USA? Homeland Security moving toward requiring foreign travelers to share social media history
UK Officials Push Back at Trump Saying European Leaders ‘Talk Too Much’ About Ukraine
UK Warns of Escalating Cyber Assault Linked to Putin’s State-Backed Operations
UK Consumer Spending Falters in November as Households Hold Back Ahead of Budget
UK Orders Fresh Review of Prince Harry’s Security Status After Formal Request
U.S. Authorises Nvidia to Sell H200 AI Chips to China Under Security Controls
Trump in Direct Assault: European Leaders Are Weak, Immigration a Disaster. Russia Is Strong and Big — and Will Win
"App recommendation" or disguised advertisement? ChatGPT Premium users are furious
"The Great Filtering": Australia Blocks Hundreds of Thousands of Minors From Social Networks
Mark Zuckerberg Pulls Back From Metaverse After $70 Billion Loss as Meta Shifts Priorities to AI
Nvidia CEO Says U.S. Data-Center Builds Take Years while China ‘Builds a Hospital in a Weekend’
Indian Airports in Turmoil as IndiGo Cancels Over a Thousand Flights, Stranding Thousands
Hollywood Industry on Edge as Netflix Secures Near-$60 Bln Loan for Warner Bros Takeover
Drugs and Assassinations: The Connection Between the Italian Mafia and Football Ultras
Hollywood megadeal: Netflix acquires Warner Bros. Discovery for 83 billion dollars
The Disregard for a Europe ‘in Danger of Erasure,’ the Shift Toward Russia: Trump’s Strategic Policy Document
Two and a Half Weeks After the Major Outage: A Cloudflare Malfunction Brings Down Multiple Sites
UK data-regulator demands urgent clarity on racial bias in police facial-recognition systems
Labour Uses Biscuits to Explain UK Debt — MPs Lean Into Social Media to Reach New Audiences
German President Lays Wreath at Coventry as UK-Germany Reaffirm Unity Against Russia’s Threat
UK Inquiry Finds Putin ‘Morally Responsible’ for 2018 Novichok Death — London Imposes Broad Sanctions on GRU
India backs down on plan to mandate government “Sanchar Saathi” app on all smartphones
King Charles Welcomes German President Steinmeier to UK in First State Visit by Berlin in 27 Years
UK Plans Major Cutback to Jury Trials as Crown Court Backlog Nears 80,000
×