The Competition and Markets Authority (CMA) has released its first monitoring report on the UK road fuel market, following a recommendation for a monitoring body to enhance competition in the sector. The report highlights a notable increase in fuel prices since May 2023, with petrol prices rising by 11.1 pence per litre and diesel by 13.9 pence per litre. The CMA will continue to monitor these trends and publish quarterly updates.

During the summer months, fuel price increases were attributed to global factors, such as rising crude oil prices. However, despite a decrease in wholesale prices in September and October, retail prices did not follow suit, raising concerns about the competitive dynamics among fuel retailers. The CMA is particularly focused on whether retailers are responding competitively to changes in wholesale prices.

The report also examined supermarket fuel margins, which decreased from an average of 11.9 pence per litre in May to 7.3 pence per litre in August. This trend indicates a potential reduction in profitability for supermarkets, although margins remain higher than pre-2021 levels. The CMA will provide further insights into margin trends in future reports.

Additionally, the CMA analyzed retail spreads, noting significant increases in September and October. The retail spread, which reflects the difference between pump prices and benchmark prices, was found to be above the long-term average, suggesting potential issues with retail competition. The CMA emphasized the need for effective competition to ensure that pump prices align with wholesale prices over time.

Data collection for the report involved requests for information from various retailers, including major players like Asda and Tesco. However, the lack of responses from some retailers limited the analysis, particularly regarding non-supermarket fuel margins. The CMA's Chief Executive, Sarah Cardell, expressed concerns about the current state of competition in the market and the importance of establishing a permanent fuel monitor with the authority to gather comprehensive data.

In a related initiative, the CMA has implemented a temporary pricing data scheme involving 12 retailers, which accounts for a significant portion of UK forecourts and fuel sales. The UK government plans to legislate for a mandatory real-time pricing data scheme to enhance transparency in fuel pricing.