Asda and Sainsbury's cut fuel prices as experts predict 5p drop within a fortnight
Sainsbury's has joined Asda in cutting fuel prices at its filling stations as industry observers predict substantial drops in costs over coming weeks.
On Tuesday, Asda announced a 2p per litre reduction in unleaded petrol prices and a 3p per litre drop on diesel, meaning drivers filling up at one of its 322 forecourts will pay no more than 108.7p per litre for petrol and 111.7p for diesel.
Subsequently, Sainsbury's said it was reducing petrol by "up to" 2p per litre and diesel by as much as 3p per litre at its 315 filling stations.
The move comes just ahead of England entering a new four-week lockdown and follows a drop in the wholesale price of fuel.
We’re cutting the price of unleaded petrol by 2p per litre and diesel by 3p a litre. It means motorists filling up at any of our 322 petrol stations will pay no more than 108.7ppl for unleaded and 111.7ppl on diesel: https://t.co/RVie3w4eBW pic.twitter.com/Z1c62cPlxX
— Asda (@asda) November 3, 2020
The RAC predicts that further cuts could follow in the next fortnight as retailers begin to pass on these savings to motorists but warned that a return to the sub-£1 prices of the first lockdown was unlikely.
Wholesale prices for both petrol and diesel fell by more than 4p per litre in October and the RAC’s Simon Williams said retailers were now under pressure to reflect this at the forecourt having failed to cut prices in the last four weeks.
He said: “It’s likely to be a case of déjà-vu for drivers this month as once again fuel prices are starting to fall just at the point when we’re all driving less as a result of a coronavirus lockdown. It’s good to see Asda leading the way this morning with an initial price cut and we now need other retailers to follow suit as quickly as possible.
“While we’re not expecting prices to go as low as last time – March saw petrol prices under £1 a litre as a result of oil prices falling to a 21st century low – any driver needing to fill up later in November should be greeted by the sight of lower prices, if retailers do the right thing.
“It remains to be seen, however, to what extent retailers pass on the wholesale savings they have been enjoying recently to drivers. While the volume of fuel sold in the coming weeks is likely to be lower than of late, we’re concerned some retailers may only choose to only cut by a few pence, or not at all, which would be bad news for drivers, especially as we don’t anticipate the roads will be as quiet as during the first lockdown.”
The AA’s Luke Bosdet also urged other fuel sellers to pass on the savings, despite the expected drop in sales. He commented: “In the last lockdown, many fuel stations held back savings from lower wholesale prices because they said they needed to compensate for lower fuel demand. Asda’s price cut throws down a challenge to other fuel retailers to do the right thing and, this time, charge a fair price for petrol and diesel.”