British motorists are receiving a welcome festive gift at the pumps, with the national average price for a gallon of regular petrol dipping below £2.90 for the first time in more than four years.
What's Behind the Price Drop?
According to data released on Thursday, 18 December 2025, the average price now stands at £2.896 per gallon, marking a steady decline over the past month. This significant drop is attributed to a combination of global market forces and seasonal trends.
Vince Stanzione, a financial expert and contributor, explained the international context. "As we head into 2026, the world remains well supplied with oil," he stated. He also pointed to geopolitical factors, noting that Russia continues to sell oil to Indian refiners, who then resell refined products to Europe, helping to suppress global prices.
Patrick De Haan, head of petroleum analysis at GasBuddy, highlighted the seasonal element. "Christmas is often when petrol prices settle near the lowest levels of the year, and 2025 is no exception," he said. He cited the completion of refinery maintenance, rising supplies, and lower winter demand as key contributors to the current trend.
Regional Price Variations Across the UK
While the national average brings cheer, the cost of filling up varies dramatically depending on location. The price disparity is largely driven by differing regional taxes and transportation costs.
Where is fuel cheapest? Drivers in regions with lower taxation and good supply infrastructure are seeing the best deals. While the original data referenced US states, the principle holds for the UK: rural areas and those with lower fuel duty often benefit from cheaper prices at independent forecourts.
Where is fuel most expensive? Conversely, remote areas and city centres, particularly in the South East, typically face the highest prices. This is due to higher operating costs, increased demand, and, in some cases, a lack of competitive pressure between retailers.
Outlook for 2026 and Holiday Travel
The good news for consumers appears set to continue. Patrick De Haan sees several "encouraging early trends" that could lead to prices sliding further into the new year.
This is particularly timely for those planning festive journeys. "Provided there are no surprises, holiday travellers should see pump prices that come in a bit lower than last Christmas," De Haan advised. This forecast offers a measure of financial relief for families embarking on seasonal visits.
For savvy motorists looking to maximise savings, experts recommend using price comparison apps to find the best local deals, as prices can vary by several pence per litre between forecourts in the same town. The ongoing price war between major supermarkets also continues to be a significant factor in keeping costs down for consumers nationwide.
