The UK Competition and Markets Authority (CMA) has reported that fuel margins continue to stay at historically high levels, which is impacting the prices that drivers pay at the pump. Senior Director of Markets at the CMA, Dan Turnbull, noted that while various factors contribute to the rising fuel prices, the persistent high margins indicate weak competition in the road fuel retail market.

From October 2024 to February 2025, fuel prices for both petrol and diesel saw an increase, with average prices reaching 139.6 pence per litre for petrol and 146.8 pence per litre for diesel. This increase reflects fluctuations in crude oil prices and refining spreads, influenced by global market conditions. The average petrol price rose by 5.2 pence per litre, while diesel prices increased by 7.1 pence per litre compared to the previous four months.

The CMA's analysis of fuel margins revealed that they remain similar to the high levels identified during its road fuel market study conducted between 2022 and 2023. Supermarket fuel margins decreased slightly from 8.6% in September 2024 to 8.2% in November 2024, peaking at 8.9% in December 2024. Non-supermarket fuel margins also saw a decline from 10.6% to 9.1% before rising to 9.8% in December 2024.

Additionally, the CMA examined retail spreads, which represent the difference between the price drivers pay at the pump and the benchmark price retailers pay for fuel. Petrol retail spreads averaged 13.8 pence per litre, while diesel retail spreads averaged 13.4 pence per litre, both significantly higher than historical averages from 2015 to 2019. This indicates that while retail spreads have decreased, they still reflect a lack of competitive intensity in the market.

In response to these findings, the CMA has recommended the implementation of a new monitoring function and a 'fuel finder' scheme to enhance competition among fuel retailers. The government has accepted these recommendations, with plans to launch the fuel finder scheme by the end of the year, allowing drivers to compare real-time fuel prices through various platforms. This initiative aims to encourage effective competition and help keep fuel prices low for consumers.