CMA Releases Latest Update on Road Fuel Market Monitoring in the UK

The Competition and Markets Authority (CMA) has released its latest report on road fuel pricing, detailing how the recent turmoil in the Middle East has influenced costs for drivers at petrol stations. This report also examines the fuel margins, which represent the difference between the purchase price that petrol stations pay for fuel and the price they sell it at, while providing an update on the Fuel Finder registration and its enforcement measures.

In an earlier report from June, the CMA highlighted that the conflict had resulted in a swift rise in wholesale fuel prices, which were subsequently passed on to consumers in the form of elevated pump prices. Additionally, the CMA raised concerns over historically high profit margins within the sector.

Current Trends in Fuel Pricing

The latest analysis indicates that a decrease in wholesale prices led to a drop in pump prices during June; however, these prices still remain significantly higher than those recorded prior to the onset of the conflict. Notably, the CMA has found no evidence suggesting that retailers have altered their pricing strategies in response to the crisis.

Despite this, the CMA expresses concern that many retailers continue to employ passive pricing strategies, which contribute to the sustained high profit margins. The analysis further reveals that certain retailers did not immediately adjust their prices in line with reductions in wholesale diesel costs, a decision that could have intensified competitive pressures among retailers.

In light of these findings, the CMA plans to maintain its active monitoring and will conduct a more comprehensive review in the autumn. This forthcoming report will delve deeper into retailers’ pricing strategies, assessing whether fluctuations in wholesale prices are promptly reflected in retail pricing, as well as exploring the reasons behind regional variations in fuel prices. The aim is to ensure that consumers are paying a fair price for fuel, regardless of their location.

Commitment to Consumer Protection

Sarah Cardell, Chief Executive of the CMA, commented on the situation: “We recognise that pump prices are exerting significant pressure on drivers’ finances, and our monitoring is essential in ensuring that retailers are not exploiting the ongoing conflict in the Middle East.” She emphasised the CMA’s commitment to closely observe prices and margins, expecting that any reductions in wholesale costs are swiftly and fully transmitted to consumers.

In the interim, the Fuel Finder initiative aims to assist drivers in saving money when refuelling. The effectiveness of Fuel Finder improves with increased usage, benefiting consumers in the short term and contributing to price reductions in the longer term.

Enhancing Competition through Fuel Finder

Fuel Finder plays a crucial role in fostering competition among fuel retailers by simplifying the process for drivers to compare fuel prices. Recent analyses indicate that approximately 97% of petrol stations across the UK are registered with the Fuel Finder scheme, accounting for an estimated 99% of fuel sold in the country.

These registered stations are actively providing price updates, enabling drivers to access current pricing information throughout the UK. It has been noted that the vast majority of these sites have reported a price update within the past week. It’s also important to clarify that if a site has not changed its prices recently, it does not necessarily indicate a failure to report; it may simply mean that prices have remained stable, particularly in smaller or rural areas where price changes occur less frequently.

Ongoing Enforcement Efforts

To date, the CMA’s enforcement actions concerning Fuel Finder have primarily focused on ensuring that retailers comply with registration requirements. Since the conclusion of the grace period in April, the CMA has issued 1,166 letters to retailers and compliance notices for 53 sites. Most registration issues are resolved swiftly upon communication with retailers, leading to high levels of compliance without the need for financial penalties.

VE3, the aggregator tasked with reporting compliance issues to the CMA, has yet to refer any suspected cases of non-compliance regarding price reporting duties. The CMA is committed to promoting adherence to regulations through outreach efforts and proportionate enforcement actions when necessary.

Additional Information for Media

Fuel Finder is a key component of the measures implemented to bolster competition within the road fuel market, following the CMA’s 2023 market study. The initiative encompasses distinct policy, operational, and enforcement roles, with the Department for Energy and Net Zero establishing the policy framework and appointing the data aggregator. The aggregator (VE3) oversees the public database, monitors compliance with scheme regulations, and refers any suspected breaches to the CMA, which is responsible for investigating and taking enforcement action as needed.

For media enquiries, please contact the CMA press office via email at press@cma.gov.uk or reach us by telephone at 020 3738 6460. For out-of-hours inquiries, the number is 020 3738 6878. Our opening hours are Monday to Friday, from 9am to 5:30pm. Please be advised to check for call charges.