paying through the nose

Judging whether petrol retailers are “profiteering” requires a close look at fuel margins and how quickly changes in wholesale costs reach drivers at the pump, while ministers and motoring groups often point to high forecourt prices as proof of “rip-offs”, official reviews and industry findings usually show a more mixed picture

Evidence used to support claims of profiteering

Motoring bodies and trade unions often highlight certain pricing patterns when they argue that some retailers are taking unfair advantage of drivers, and one of the best-known examples is “rocket and feather” pricing, where pump prices climb quickly when wholesale costs rise but fall much more slowly when those costs come down, for example, the RAC has pointed to cases where wholesale prices dropped by around 7p a litre, yet pump prices either stayed the same or even increased

The Competition and Markets Authority, CMA, also found in 2023 that weaker competition had pushed up supermarket fuel margins, with margins rising from about 4.7% in 2019 to much higher levels by 2022 and 2023, and campaigners also cite sharp price gaps between nearby forecourts, sometimes 10p or more per litre, as a sign that some stations charge more where local competition is weak.

Evidence used against claims of profiteering

Retailers and some independent assessments say high pump prices are not simply the result of excess profit, because many independent forecourts report net fuel margins of only 0% to 4%, so they depend on shop sales such as coffee, snacks, and groceries to stay afloat

They also point to rising overheads, and the Petrol Retailers Association says higher wage bills, business rates, and electricity costs have all kept retail prices above older norms, while retailers add that lower wholesale prices do not appear at the pump straight away because they first need to sell fuel bought at earlier, higher prices, otherwise they would cut prices and take a loss on existing stock

Official oversight

To tackle possible unfair pricing, the UK government introduced the Fuel Finder Scheme, which requires larger retailers to share real-time fuel price data so drivers can compare prices more easily, and the CMA is still watching the market closely, having recently put retailers on notice so that any rise or fall in pump prices matches genuine cost pressures rather than weak competition or opportunistic pricing.’