New data from RAC predicted fuel pump prices dropping in the middle of November 2020, good news for fleet decision makers and company car drivers.
It suggested that October’s stable petrol prices should lead to price cuts of up to 5p per litre as low oil demand lowers prices. This news comes just as England enters its second nationwide coronavirus lockdown.
As of November 3rd, supermarket Asda has already cut up to 2p off a litre of petrol (charging no more than 108.7p) and 3p off diesel (charging no more than 111.7p).
According to new RAC Fuel Watch data, despite the price of a litre of petrol remaining almost unchanged for a second month running at a little over 114p on average last month (114.53p at the start of the month, 114.43p at the end), wholesale unleaded prices dropped 4.62p to just 82.26p through October thanks to falling oil prices.
Commenting on the data, RAC fuel spokesman Simon Williams said: “It’s good to see Asda leading the way with an initial price cut and we now need other retailers to follow suit as quickly as possible.”
RAC believes diesel in particular has been over-priced for nearly two months now, with pressure mounting for retailers to cut prices.
Between the middle of August and the middle of October, the wholesale price of diesel was below that of petrol and in October it fell again by 4.62p per litre to 83.73p.
However, diesel pump prices remain significantly higher than petrol at 117.82p at the end of last month, down just 0.27p compared to at the start of October.
As the second coronavirus wave continues to impact on trade and travel, it has also caused oil prices to drop as global demand remains a concern. The US election result may also have some effect on prices, although analysts appear divided on whether prices end up slightly higher or slightly lower.
“While we’re not expecting prices to go as low as last time, March saw petrol prices under £1 a litre as a result of oil prices falling to a 21st century low, any driver needing to fill up later in November should be greeted by the sight of lower prices, if retailers do the right thing. It remains to be seen, however, to what extent retailers pass on the wholesale savings they have been enjoying recently to drivers.”
Williams expressed concerned that some retailers may only choose to only cut by a few pence, or not at all. The UK lockdown, he believes, will see the demand for fuel drop as drivers commit to essential travel only.
“There is perhaps a cruel irony for motorists here in that the route to cheaper prices is cheaper oil, yet the main reason the oil price is lower is because so many of us across the world aren’t travelling,” said Williams.
“Diesel drivers in particular have reason to feel particularly hard done by, as arguably they have been paying over the odds for the fuel for two whole months now. We strongly urge retailers to lower the price of diesel, both for businesses and the country’s 12m-plus diesel car drivers.”