Economy

Supermarket petrol postcode lottery: You could be paying 14p a litre more for fuel depending on where you live

The difference between the cheapest and dearest petrol prices at supermarket forecourts in January was a massive 14ppl

Drivers who fill up with fuel at supermarket petrol stations face a postcode lottery with the cost of a litre of unleaded differing by up to 14p-a-litre depending on where you live.

The cheapest litre of supermarket unleaded at the end of last month was at Sainsbury’s filling stations in Wantage, Oxford and Cwmbran, Newport priced at 131.9p, while the most expensive was Morrisons forecourts in Budge, Exeter and around Ipswich – in Diss and Fakenham – charging 145.9p, analysis by the RAC revealed.

The motoring group described the huge gulf in costs as ‘blatantly wrong’, especially after the competitions watchdog found evidence of supermarkets being the worst offenders for not giving drivers a fair deal at the pumps.

The RAC’s report confirms fuel prices stopped falling in January after three consecutive months of decline.

This was despite the wholesale prices of both petrol and diesel increasing by 3p and 4p respectively in the month as oil rose above $80 a barrel for the first time since the end of November. 

Sainsbury's has the biggest price difference across the country. A litre of unleaded at its filling stations in Wantage, Oxford and Cwmbran, Newport priced at 131.9p while some of its other locations are charging up to 144.9p

Sainsbury’s has the biggest price difference across the country. A litre of unleaded at its filling stations in Wantage, Oxford and Cwmbran, Newport priced at 131.9p while some of its other locations are charging up to 144.9p

Sourcing government data, the RAC said the average price of a litre of petrol stayed at 140.5p in January while diesel remained at 148.5p.

Based on the average family car having a 55-litre tank, this translates to £77.24 and £81.73p to fill up with the respective fuels. 

In Northern Ireland, however, petrol was 4.2p cheaper than the UK average at 136.2p by the end of the month and diesel was 3.5p lower at 144.9p, showing drivers are still not being charged a fair price across the whole of the country.

And supermarkets are putting motorists over a barrel based on where in the UK they live, the review found. 

Tesco has the smallest price gap between its priciest and cheapest diesel prices - though the gulf is still a significant 9p. Sainsbury's again has the biggest difference of 14p for the fuel

Tesco has the smallest price gap between its priciest and cheapest diesel prices – though the gulf is still a significant 9p. Sainsbury’s again has the biggest difference of 14p for the fuel 

Analysing the prices charged by Asda, Morrisons, Sainsbury’s and Tesco – the big four supermarkets that dominate UK fuel retailing – via the Government’s voluntary price reporting scheme, the RAC identified wildly varying prices from place to place. 

The largest gap in price between the cheapest and dearest was 14p – which works out at £7.70 when filling up. 

The average difference between a litre of petrol at the same supermarket chain was nearly 12p (11.6p).

The report said Tesco had the smallest gap – 8p – between its lowest of 138.2p and highest of 142.9pm while Sainsbury’s had the largest at 14p.

For diesel, there was a spread of more than 14p between Sainsbury’s forecourts in Banbury, Oxford and Cwmbran, Newport charging 139.9p, compared to Frome, Bath at 153.9p. 

The average spread between supermarkets’ high and low diesel was just over 11p (11.3p).

The RAC published the changing price of of petrol and diesel by region during the month of January

The RAC published the changing price of of petrol and diesel by region during the month of January

The inflated cost of fuel at some supermarket forecourts in parts of the country is emphasised by far cheaper prices at Costco and a number of independent retailers.

The wholesaler, which has 20 filling stations across Britain, is undercutting the rest of the market by an average of 10p a litre, offering Costco members petrol for just 130p and diesel for 139.6p. 

Meanwhile, an independently run forecourt in Grindley Brook in Whitchurch, Shropshire, is only charging 133.9p for petrol – nearly 7p less than the UK average.

This has forced three nearby retailers to compete by pricing their unleaded at 136.9p – again well below the average price across the country.

Simon Williams, from RAC, said it was concerning to see supermarkets charging wildly different prices in parts of the country, especially following the recent Competition and Markets Authority investigation.

The watchdog’s probe into the fuel retail market found evidence of supermarkets not passing on savings to drivers at the pumps in 2022.

This investigation sparked the Government to accelerate plans for a new ‘Pumpwatch’ scheme, which would legally require all fuel stations to share live information on their pricing within 30 minutes of any change.

‘The data retailers are voluntarily providing to the CMA has shed a whole new light on the pump price postcode lottery,’ Williams said.

‘It seems blatantly wrong to us that the very same petrol or diesel can vary in price by as much as 14p a litre, depending on where drivers are filling up.’

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