London Daily

Focus on the big picture.
Thursday, Sep 10, 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
Merz Rebukes AfD Expansion in Saxony-Anhalt
King Charles Confirms Prince Harry and Meghan Will Remain Private Citizens
Labour Selects Former Child Refugee for By-Election in Keir Starmer’s Former Seat
Foreign Private Equity Accelerates Takeovers of London-Listed Industrial Companies
NHS Maternity Care Faces Scrutiny Over Support for Mothers After Caesarean Births
BBC Warns Staff Strikes Are Likely Amid Job Cuts and Programme Cancellations
English Housing Affordability Improves to Best Level in More Than a Decade
UK Health Commission Proposes Framework for Wider AI Adoption Across NHS
Labour Faces Pressure for Wealth Tax Ahead of Autumn Budget
Metropolitan Police Open Criminal Investigation Into Alleged Foreign Donations to Reform UK
UK Police Deploy Riot Officers After Anti-Immigration Unrest in Portsmouth and Dover
UK Defends Sanctions on Israeli Settlements Despite Diplomatic Retaliation
UK Air Traffic Control Failure Cancels More Than 1,000 Flights and Disrupts 65,000 Passengers
Compass Urges £10 Million Wealth Tax and Public Ownership Ahead of UK Autumn Budget
UK Government’s Devolution Plans Face House of Lords Scrutiny
Maldives Seeks New Chagos Sovereignty Talks With UK Prime Minister Andy Burnham
UK Airports Face Continuing Disruption After National Air Traffic Control Failure
UK Bans Imports From Israeli Settlements and Expands Sanctions on Iran
British Chambers of Commerce Forecasts UK Growth of 1% as Investment Remains Weak
UK Suspends Local Government Reorganisation Decisions and Cancels Planned Shadow Authority Polls
UK Parliament Opens Inquiry Into Gaps in Climate Change Preparedness
Andy Burnham and Xi Jinping Hold Talks on Trade, Security and British Consular Cases
UK Joins France, Canada and Other Nations in Measures Against Israeli West Bank Settlements
UK Announces New Sanctions Targeting Iranian Nuclear and Military Networks
British Chambers of Commerce Calls for Business Rate Reform and Productivity Support
UK Farmers Warn Dry Summer Could Reduce Crop Yields and Push Up Food Prices
UK Rail Networks Hit by Widespread Delays After Major Signalling Failures
Matt Clifford Resigns as ARIA Chair After Conflict-of-Interest Scrutiny
UK and France Say Joint Border Operations Have Prevented More Than 48,000 Irregular Channel Crossings
UK Core Inflation Remains Above Expectations as Utility and Commodity Costs Stay Elevated
Jaguar Land Rover Considers Up to 4,000 UK Job Cuts Amid Automotive Industry Pressure
UK Government Pauses Local Authority Reorganisation for Legal Review
UK Public Borrowing Reaches £1.8 Billion in July, Adding Pressure Before Autumn Budget
Chancellor John Healey Puts Regional Devolution and Fiscal Discipline at Heart of UK Growth Plan
Counter-Terrorism Police Lead Salford Investigation After Two Teenagers Charged
UK Rejects Financial Reparations for Transatlantic Slavery
UK and Egypt Step Up Diplomacy Over Escalating West Bank Tensions
UK Pauses Council Reorganisation Across Four English Counties
Jaguar Land Rover Plans 4,000 Job Cuts in Major UK Restructuring
UK Unveils Planning and Regulatory Overhaul to Speed Infrastructure and Economic Growth
University of Bristol Opens £500 Million Innovation Campus
Families Give Evidence to Independent Review of Sussex Maternity Failures
Sweden Confirms Deportation of 458 British Citizens Over Post-Brexit Residency Rules
UK Launches £3 Million Challenge for Long-Duration Energy Storage
Reform UK Proposes £100 Billion in Spending Cuts and Brownfield Deregulation
Andy Burnham Warns Macron That EU Procurement Rules Could Hurt British Steel
Andy Burnham Faces Major Decision on Future North Sea Oil and Gas Drilling
SEND Support in England Projected to Reach One in 10 Pupils
England’s Housing Courts Struggle With Surge in No-Fault Eviction Cases
Violent Clashes Erupt in Portsmouth During Protest Against Asylum Processing
×