News

SUPERMARKETS REDUCE PETROL PRICES

Tuesday, 22 July 2008 10:23

UK drivers are set to benefit after a number of supermarkets said they would lower the price of petrol.

Asda said it would cut the price of unleaded petrol and diesel by 3 pence per litre, while Morrisons said it would cut both prices by 4p per litre.

Sainsbury's said it would look to match its rivals in local areas, and offer an extra 5p off per litre for customers who spend £50 or more on food in store.

Tesco said it had been running a similar promotion for the past month.

Fuel prices have risen in recent months as the price of crude oil has increased. Oil prices hit record levels above $147 a barrel in early July.

However, oil prices have dropped recently, to about $132 a barrel, resulting in a 6% fall in the wholesale price of petrol since mid-July, according to the AA.


Helping hand?

Asda's price change came into effect on Tuesday, making unleaded petrol 113.9p per litre with diesel 128.9p.

David Miles, Asda's trading director, said: "We are seeing a more stable reduction in oil prices, allowing us to pass on the savings to customers.

"We urge other retailers to follow our lead at a time when customers need as much help as possible."

Morrisons introduced its price change on Monday evening. It said it was "ensuring customers reap the benefit [of lower oil prices] by passing on the saving quickly, for cheaper prices at the pump".

A Tesco spokesman said that it had been offering 5p off per litre to customers who spend at least £50 in store for the past month and added that it always looked to match competitors locally.

Sainsbury's said its fuel promotion would start on Thursday 24 July and end on Thursday 7 August.

It explained in a statement that: "Our customers can reap an even bigger reward because we are running a 5p off per litre promotion when they spend £50 or more in-store and they will earn Nectar points as well."


'Dragging their feet'

The AA said that wholesale gasoline prices had fallen 6% since mid-July and it said other fuel retailers should follow the supermarkets' lead and cut petrol prices.

"The AA expects fuel suppliers to pass on, not pocket, the saving for the good of UK families, hauliers and the economy," said AA president Edmund King.

"Should fuel suppliers and retailers appear to be dragging their feet we will seek to expose this."

Ray Holloway, of the Petrol Retailers Association, said independent fuel retailers would be unlikely to respond immediately to the cuts.

"The supermarkets are moving the price in anticipation of further falls in the wholesale price, " Mr Holloway said.

"Independents will pass on those falls in due course."
Source: http://news.bbc.co.uk/1/hi/business/7518516.stm