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Diesel price falls by record 12p in May, but RAC says prices should drop even further
3 June 2023, 09:09
The price of diesel dropped for the seventh straight month in May, by a record 12p on average.
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The RAC said the average price of the fuel at UK forecourts dropped from 158.9p to 147.0p in May.
Despite this being the largest monthly reduction since the motoring services company began tracking fuel prices in 2000, it believes the cut should have been more significant to fully reflect changes in the wholesale market.
The price drop has lowered the cost of filling a typical 55-litre family car by around £6.50.
May was the seventh consecutive month in which pump prices fell.
The average price of a litre of petrol dropped by more than 3p from 146.5p to 143.3p last month.
On May 15, the Competition and Markets Authority watchdog reported that indications show higher pump prices in 2022 "appear in part to reflect some weakening of competition".
RAC fuel spokesman Simon Williams said: "After calling for big pump price cuts for weeks, we were pleased to see that May was the month where this finally happened.
"The fact it appears to have been prompted by the Competition and Markets Authority's mid-month announcement about weakening competition in fuel retailing is surely not a coincidence.
"A 12p reduction in the price of diesel in one month is something we haven't seen in nearly 23 years of monitoring prices.
"But despite this, it's still galling to see that a litre of diesel is 8.5p cheaper in Northern Ireland than it is in the rest of the UK.
"This points to a more transparent and competitive fuel market there, something drivers in the rest of the UK would very much like to see, particularly with money being so tight in the cost-of-living crisis."
Fuel prices rose fast at the start of 2022, in part because of the war in Ukraine and sanctions on Russian businesses. This helped drive soaring inflation.
Inflation has begun to ease in the UK recently in recent weeks, partly because of falling energy costs, although food prices are still high.
The RAC's calls come after ministers considered the possibility of introducing a 'PumpWatch' regulator.
Under the plans, reported in January, retailers would face pressure to make sure that what drivers pay accurately reflects wholesale costs.
It is believed the PumpWatch system would be voluntary but retailers who fail to lower their prices in relation to wholesale costs could even be named-and-shamed under the plans.