Motorists could see welcome relief at the pumps within days as petrol and diesel prices look set to change, following a sharp fall in Brent crude oil prices. Early Friday trading saw Brent crude at around $73.94 per barrel, a significant drop from peaks exceeding $100 during the Middle East conflict, and heading towards a substantial weekly decline as concerns over major supply disruptions subsided.
RAC Predicts Further Price Drops
The RAC predicts pump prices will keep dropping this weekend and into next week. RAC head of policy Simon Williams said: "On the back of the lowest oil price since before the Iran war started, drivers should see the average price of petrol fall below 150p in the next week or so. If this happens, unleaded will be at its lowest price since March 26." He added: "Diesel, having dropped below 170p today for the first time since March 22 as shown in the Government's Fuel Finder data, ought to go back under 160p. We urge retailers to pass on the savings they're benefiting from on the wholesale market to drivers straightaway."
Current Price Trends and Comparisons
RAC data reveals that average petrol prices have already tumbled 7.2p per litre since reaching a peak of 159.53p on May 28, while diesel has plummeted 22.17p per litre from its April high of 191.54p. On Thursday, typical forecourt prices stood at 152.32p for petrol and 169.37p for diesel. Before the war began, an oil price of $70 translated to an average petrol price of 132p and 141p for diesel.
Global Oil Market Shift
These recent reductions follow a significant shift in global oil markets as concerns about supply disruptions through the Strait of Hormuz have begun to subside. Tankers have recommenced passage through the crucial shipping route, and traders are increasingly confident that worldwide supplies will remain abundant.
Watch for Price Gouging
The decline has triggered fresh examination of fuel retailers, with consumer champion Martin Lewis urging motorists to monitor pump prices closely. He warned this week: "Now is the time to watch for price gouging. It normally happens when prices drop after a peak." He also said: "No accusation just saying it needs monitoring."
Regulator Monitoring
The Competition and Markets Authority is already conducting enhanced surveillance of the fuel market, monitoring pump prices, retailer margins and wholesale costs amid worries that motorists may not always receive the complete benefit of falling oil prices. The regulator has repeatedly investigated whether decreases in wholesale fuel costs are being transferred fairly to drivers, following concerns about insufficient competition in certain areas of the market.
Driving organisations have repeatedly criticised the so-called "rocket and feather" phenomenon, whereby forecourt prices surge quickly when crude oil costs increase but decline far more gradually when wholesale expenses drop. The AA has similarly maintained that consistent falls in wholesale fuel and oil costs ought to be passed on at the pumps, especially while families continue to face pressure from the broader cost-of-living crisis.
